SinnerSchrader Annual Report 1999/2000 by SinnerSchrader

SinnerSchrader Aktiengesellschaft Annual Report

AS PION E E RS I N TH E CONCE PTION 18.08.00

B EG I N N I NG OF JOI NT VE NTU R E B ET W E E N B LU M E 2000 AN D SINNERSCHRADER

02.08.00

S I N N E R S C H R A D E R B R I N G S c os hop p e r.c om T O G E R M A N Y

01.08.00

S I N N E R S C H R A D E R L A U N C H E S t ch ibo. de

24.07.00

S I N N E R S C H R A D E R P R E S E N T S A N E W P L AT F O R M S T R AT E GY : UNIFIED COMMERCE

20.07.00

S I N N E R S C H R A D E R W I N S T H E OT TO C O N T R ACT

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S I N N E R S C H R A D E R A N D M E D I AT R A N S F E R B U I L D S T R AT E G I C A L L I A N C E

25.05.00

S I N N E R S C H R A D E R I S S T R AT E G I C e C O M M E R C E PA R T N E R FOR THE EUROPEAN INTERNET INSURANCE INEAS

10.05.00

S I N N E R S C H R A D E R D E V E L O P S I N T E R N AT I O N A L B -T O - B P L AT F O R M F O R T H E P R O P E R T Y M A R K E T : prope rt ygat e . c om

18.04.00

S I N N E R SCH RADE R I NCR EAS E S TU R NOVE R AN D P ROF IT FOR ECAST F O R 19 9 9 / 2 0 0 0

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S I N N E R S C H R A D E R B E C O M E S S T R AT E G I C e C O M M E R C E PA R T N E R TO TC H I B O

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S I N N E R S C H R A D E R B E G I N S E U R O P E A N E X PA N S I O N I N T H E U K W I T H e u rop c ar. c o. u k . A N D g oric ardo. c o. u k

28.02 .00

S I N N E R S C H R A D E R I S I N V O LV E D I N T H E F I R S T E U R O P E A N e S H I P P I N G ENTERPRISE: letmeship.com

28.0 1.00

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28.0 1.00

S I N N E R SCH RADE R I S P ION E E R I N MOB I LE C OM M E RCE / E U ROP CAR S TA R T S W A P R E S E R V AT I O N S

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S I N N E R S C H R A D E R D E V E L O P S B -T O - B P L AT F O R M F O R rica rd o. d e

06.12 .99

S I N N E R S C H R A D E R : G Ö R T Z S H O E S N OW H AV E O N LI N E O R D E R I N G

23.11 .99

S I N N E R S C H R A D E R D E V E L O P S N E W L E A S I N G P L AT F O R M S F O R A L D

11.11 .99

DE UTSCH E BAN K 24 I S R EC O G N I S E D AS B E ST ON LI N E B ROK E R

02.11 .99

S I N N E R S C H R A D E R ’ S S H A R E P R I C E C L O S E S AT 7 9 P E R C E N T A B O V E THE IPO PRICE

01.09.99

I NTE R N ET B RANCH OF DE UTSCH E BAN K 24 GOE S ON LI N E

01.09.99

S I N N E R S C H R A D E R L A U N C H E S TA L K L I N E H A N DY S H O P O N T H E I N T E R N E T

and creation of innovative eBusiness strategies, we develop solutions that set industry standards and transform our clients into market leaders.

A H I G H L E V E L O F C O M M I T M E N T,

enthusiasm for the project and real partnership lead to close identification of the team with the client. Only in this way can outstanding solutions be developed and perfectly implemented within a short time frame.

SinnerSchrader share price development 1999

Key figures of the SinnerSchrader Group

2000

400 %

01.09.1999 31.08.2000

01.01.1999 31.08.1999

Change in %

Revenues

in DM 000s

28,677

8,400

241

thereof Project services

in DM 000s

19,069

5,549

244

as % of revenue

in %

66.5

66.1

Operating profit

in DM 000s

6,576

2,826

as % of revenue

in %

22.9

33.6

in DM 000s

3,849

1,340

in %

13.4

16.0

300 % 200 % 100 % 0%

02.11.

30.11.

16.11.

28.12.

14.12.

25.01.

11.01.

22.02.

08.02.

21.03.

07.03.

18.04.

04.04.

16.05.

02.05.

SinnerSchrader SinnerSchrader

13.06.

03.05.

Nemax Nemax

11.07.

27.06.

08.08. 31.08.

25.07.

22.08.

issue price

Net income

as % of revenue Net income per share

number of shares outstanding

in DM

0.40

0.22

in units

9,608,278

6,025,000

Number of employees – end of period

120 %

133

187

174

181

102.7

38.2

169

in DM 000s

186

218

- 15

Shareholders’ equity

in DM 000s

66,104

5,487

1,105

Balance sheet total

in DM 000s

75,590

8,451

794

Liquid funds and marketable securities

in DM 000s

60,718

6,150

887

Cashflow from operating activities

in DM 000s

- 609

2,582

- 124

Number of employees – ø full-time equivalents

100 % Project services per employee

80 %

ø full-time equivalents

60 % 40 % 20 % 0% 16.05.00

31.05.00

15.06.00

30.06.00

15.07.00 SinnerSchrader

30.07.00

14.08.00

31.08.00

Nemax Internet

weighted average number of shares outstanding (diluted)

annualised

B A S E D O N A N I N N O V AT I V E A N D

standardised process model and a culture that lives and breathes the principle of open knowledge exchange, the innovation and implementation of our solutions are as intelligent as they are efficient.

We work for the success of our clients. We want to open up the Internet for them as an integrated platform for their successful business development. We call this Unified Commerce. F L AT H I E R A C H I E S A N D F L E X I B L E

project teams encourage a pragmatic attitude, guaranteeing a rapid reaction to both client and market demands. This dynamism is the power behind our outstanding growth.

SinnerSchrader. Creating winners in eCommerce.

LE T T E R TO T H E S H A R E H O LD E R S

Dear shareholders, With a turnover of almost DM 29 million and operating profits of more than DM 6.5 million, turnover has organically trebled, whilst operating profits have doubled from last year. At the end of SinnerSchrader's first business year as a listed company, the SinnerSchrader team is pleased to be able to present to you a balance that has exceeded our already ambitious plans. This is all the more pleasing given that the end of our business year falls during a time of negative reports about the Internet sector, a time when Internet euphoria seems to have been replaced by a climate of scepticism. The opportunities, however, are still great! Only that it is now becoming clear who can best benefit from the changes along the

OLIVE R S I N N E R

LE T T E R TO T H E S H A R E H O LD E R S

entire value chain triggered by the Internet as an integrated platform. Therefore, our previous business year was not just about increasing turnover and profit for SinnerSchrader, but was also about creating the conditions that will establish SinnerSchrader in a leading position as a comprehensive service partner in this complex process. At the centre of our strategy are the clients and the challenge to make their respective business models successful on the Internet. Together with our clients we have been able to achieve a great deal â&#x20AC;&#x201C; because SinnerSchrader is not satisfied with easy answers; because we can build on extensive experience from four years as an eCommerce enabler in our strike for innovative yet functional solutions; and because we possess the critical technological competence and implementation power. From the online launch of the multi-channel bank Deutsche Bank 24 on 1 September 1999 to the launch of the website for our client and venture partner Blume 2000 on 18 August 2000, we have implemented a large number of successful eBusiness solutions over the last year. More than ten new customers have opted for SinnerSchrader as their partner in the provision of consultancy and eBusiness solutions; these include names such as Tchibo and OTTO Versand.

M AT T H I A S S C H R A D E R

Unified commerce, the integration of all business processes on an Internet based technology platform is our vision. During the past year we have consistently orientated our consultancy, process and technology competencies towards this vision. In a first phase we have pursued an entirely organic growth path, aiming to strengthen the SinnerSchrader culture and the scalability of the organisation. Through work with foreign clients and the organic start up of a subsidiary in London, we have taken the first step towards the internationalisation of SinnerSchrader. A successful launch on the stock exchange has given us the means to force this expansion process through the acquisition of other companies. However, the solid foundations of our growth are more important to us than any short-term effect on the stock exchange. Shortly after the close of the business year, we have begun to implement our acquisition strategy by taking over the eCommerce

D ETLE F WICH MAN N

software specialist Netmatic Internet / Intranet Solutions GmbH. This acquisition means the significant extension of our technological competence. The speed of development in the Internet world is rapid; the opportunities are enormous. With the characteristics of SinnerSchrader, dynamism and motivation, and on the basis of our achievements during the last business year, we will continue the SinnerSchrader success story. Leading, involved, smart and direct: those are the values that shall guide our business development. The new corporate design introduced with the start of the fiscal year 2000 / 2001 sets an exciting framework reflecting the enthusiasm of the whole SinnerSchrader team in this work for the future of your company. Hamburg, October 2000 The Management Board

T H O M A S DYC K H O F F

MARKET S U C C E S S S TO RY

Tchibo

BUSINESS MODEL S U C C E S S S TO RY S T R AT E GY

Schneider-Group

UNIFIED COMMERCE

S U C C E S S S TO RY

Libri

Europcar

PROCESS MODEL S U C C E S S S TO RY S T R AT E GY

eV E N T U R E S

S U C C E S S S TO RY

LetMeShip

I N T E R N AT I O N A L I S AT I O N S U C C E S S S TO RY

Ineas

Blume 2000

E M P L OY E E S S U C C E S S S TO RY O U T LO O K S TO C K G LO S S A RY

P RPORFOI LF Ider SinnerSchrader Aktiengesellschaft L E of SinnerSchrader Aktiengesellschaft

MAR KET

Focus on the market growth of eBusiness The demand for high-end eCommerce solutions in particular has recently grown beyond all expectations. Meanwhile, the client structure for consultancy and service provision implementation has changed drastically over the last 12 months. Initially it were young start-up enterprises that determined demand, with innovative ideas for net-based business models supported by a dynamic venture capital scene. Recently however, classic enterprises from the old economy have caught up dramatically, and it is they who now form the dominant client base. The central focus no longer lies with isolated Internet projects, but with business critical Internet strategies for the opening up of new markets andlines of distribution. Consequently, the requirements for providers of eBusiness-Services have also changed greatly over recent months: it is now the entire solution competence – especially regarding the encapsulation of complex back-end systems and the systematic integration of all digital distribution channels – that has become the deciding point of differentiation when choosing service providers. SinnerSchrader has an outstanding position within this new market environment. As a pioneer within the industry, SinnerSchrader has by far the most extensive experience in the conception and implementation of demanding eCommerce solutions. By consistently increasing capacity, SinnerSchrader has continued to build upon this leading position. Particularly notable is the above average development of an already very strong technological competence, on a qualitative as well as quantitative basis. Considering the increasing complexity of projects and the strong competition in the personnel market this aspect is critical to success. TH E eB US I N E S S MAR K ET I S ON E OF TH E FASTE ST G ROW I NG I N DUSTR I E S WOR LDW I DE.

TH E OLD E CON OMY I S CATCH I N G U P RAPI D LY;

within about six months, their share of SinnerSchrader’s client structure has grown to 70 %.

S U C C E S S S TO RY

java beans

S U C C E S S S TO RY

We have a unique concept for success: every week a new world.

PATR I CK H OFMAN N

Managing Director, Tchibo Internet GmbH

very week a new world that ist what Tchibo presents via 15,000 retail outlets throughout Germany. The sale of consumer goods, grouped around a common theme changed weekly, has developed into an enduring and significant part of the companyâ&#x20AC;&#x2122;s strategy. So has the Internet. Since 1998, Tchibo.de has been one of the ten most successful eCommerce sites in Germany. Last year they realised sales in the tens of millions. With the 2000 relaunch, Tchibo continues this success story in a determined fashion. Optimisation and fine-tuning of the front-end process, establishment of customer loyalty instruments and integration with the back-end systems, are all leading to greater customer service while in the same time reducing maintenance costs. Solid foundations for future growth in new media are thereby being laid.

www.sinnerschrader.com/en/stories/tchibo/ www.tchibo.de

B US I N E SS MODE L

One stop,full service CUSTOM MADE H IG H-E N D eC OM M E RCE SOLUTION S AN D TH E I R I M P LE M E NTATION I N A S HORT TI M E R EQU I R E F LE X I B LE P ROJ ECT TEAM S that, together with the client, can quickly and independently develop and produce innovative solutions. Providing comprehensive client services, in the sense of “one stop shopping”, SinnerSchrader differentiates between the services it provides according to four areas of competency: consultancy, design, engineering and business generation.

CONSULTING

CONSULTING: RE-THINK EVERYTHING

In order to be successful in eCommerce, it is essential to learn many new rules. The reverse is also true: many rules from the old economy still retain their validity today. Both businesses from the new economy and established brands are finding themselves involved in radical change and they are rapidly becoming similar in many ways. Our consultants actively work with this process of transformation, analyse options and develope commercial and operational eBusiness strategies that can be realistically implemented. The strategies cover everything from brand development, the development of front-end and back-end processes to the construction of intelligent customer retension programmes. In order to be able to deliver an optimum depth of advice, consulting is structered around the solution centres: “Retail/Consumer Goods”, “Financial Services”, “Telcos/Logistics”, “Automotive/Tourism” and “Corporate”.

EXPERIENCE DESIGN

ENGINEERING

E X P E R I E NCE DE S IG N: TE ST EVE RY TH I NG

E NG I N E E R I NG: I NTEG RATE EVE RY TH I NG

In the field of user interface design for eCommerce applications, important navigation standards have been established which are now understood throughout the world. Therefore, the challenge for design is these days to optimise session into the depth of a transaction, the next “click”. For this, SinnerSchrader uses its own Experience Models developed in-house, which represents the knowledge gained from observing the behavioural pattern of millions of user sessions, in the form of optimised front-end processes. To attract users to a site, and to ensure an exciting shopping experience once they are there, an independent editorial team develops strategic and attractive content at SinnerSchrader. An important part of our method is the use of prototypes and usability -tests. In this way, a site can be tested and improved with regards to its ability to change visitors into buyers even before its actual implementation. In the field of design, totally new tasks are emerging because of the implementation of multichannel eCommerce strategies. Here, the bandwidth ranges from the very limited possibilities of WAP solutions through the classic GUI programming of Swing-based back-office tools right up to TV design for broadband and kiosk applications.

In order to attain maximum scalability of its engineering skills and project synergies, SinnerSchrader has focused persistently on the leading standards in the industry: Java , EJB , Corba and XML . By concentrating on these key technologies, SinnerSchrader controls the technologically most important building block of each eCommerce solution – the Middleware , which links front-end and business logic to existing back-end systems. This Middleware competence allows SinnerSchrader to implement customised business processes and value added services within a short time period. In this way, SinnerSchrader obtains a visible market advantage and is able to react quickly and flexibly to market changes and customer requirements. Due to a concentration on high-volume transaction solutions, the development of scalable and high-performance system platforms has become another very important competence within the service portfolio. This encompasses the planning and implementation of essential operation and safety concepts.

BUSINESS GENERATING

BUSINESS GENERATING: OPTIMISE EVERYTHING

Successful eCommerce solutions require a correspondingly high profile within the market. By creating integrated online campaigns – involving everything from planning, to banner creation and evaluating the performance – SinnerSchrader optimises the marketing budget of its clients. Thanks to Adtraction technology, developed in-house by SinnerSchrader, sales and clickstreams can be assigned directly to even a single advertisement for the first time thus enabling an optimisation of the cost-per-order. Using the Adraction technology, SinnerSchrader analyses the behaviour of the user on eCommerce sites with the help of modern Data mining tools. On the basis of these analyses front-end processes and product ranges are continually adjusted to increase the conversion quota of visitors to buyers.

S U C C E S S S TO RY

fashion flash

S U C C E S S S TO RY

An enterprise such as the Schneider group demands a platform strategy, not isolated solutions.

TH OMAS STAM E R

Managing and Sales Director, e-lationship GmbH (Schneider group)

or the Schneider group, doing pan European business, a new alignment to an eCommerce platform strategy was crucial: previously independently realised solutions were to be consolidated into a standardised eBusiness architecture. The integration of stock data, customer data and the business processes into one eCommerce platform provided the necessary freedom to clearly differentiate individual distribution lines with regard to their market position and their respective added values on the Internet. Consequently, the mail-order brand for the lifestyle products Conleyâ&#x20AC;&#x2122;s, Impressionen and Bambola present themselves in different ways on the web: cult in the first case, fine in the second, lascivious in the third case â&#x20AC;&#x201C; but always exactly suited to the target group.

www.sinnerschrader.com/en/stories/conleys/ www.conleys.de www.impressionen.de www.bambola.de

S T R AT E GY

Unified Commerce TH E I NTE R N ET I S I NCR EAS I NG LY EVOLVI NG I NTO AN U B IQU ITOUS BAS E TECH NOLOGY FOR ALL DIG ITAL DI STR I B UTION CHAN N E LS: new end appliances such as Internet compatible WAP or GPRS mobiles, PDA s , stationary Kiosk terminals and digital TV will gain acceptance. In the future, completly new and highly integrated process chains will be build by means of the industrial standard XML . In the centre is the end user, who is able to make interactive contact with the business at any time, using the entry point of choice. Regardless of whether the customer buys at a conventional retail outlet, over the telephone, or on a website: customer data must be validated in real time, bonusses must be calculated and set off against the customer account, and consistency of price and conditions must be ensured across all channels. It is the goal of the SinnerSchrader unified commerce strategy to consolidate all digital distribution channels within one standardised process landscape. To transform this vision into reality, SinnerSchrader has developed an adaptable reference architecture on Java / XML , which employs reusable, quality assured business components based upon conventional Middleware such as J2EE and WebObjects. As a result of a classic multi-tier concept, this architecture offers maximum flexibility for the optimisation and innovation of business processes as well as the integration of ERP -, CRM - and Content Manangement Systems . Using advanced caching and page pre-generating techniques, this reference architecture is especially suitable for extremely high load solutions.

F OR G ET I S OLATE D S OLUTI ON S;

in accordance with the unified commerce strategy, SinnerSchrader is integrating all sales channels into a consolidated process landscape using standardised business components.

S U C C E S S S TO RY

books & mortar

S U C C E S S S TO RY

Selling as a wholesaler on the Internet? Without fear of contradiction: Libri.de makes the book trade fit for Internet business.

LAR S K I LAN D E R

Managing Director, Libri.de GmbH

ooks are currently the most frequently traded item on the Internet. In 1996, Libri – as one of the pioneers in Germany – decided to develop the Internet as a new distribution channel. In developing an eCommerce-strategy Libri forced the challenge of how to link the online offers wih the classic indirect sales channel through book retailers. The solution: a platform strategy offering all book retailers the opportunity to do business online. Libri develops and operates the eCommerce application and the catalog takes care of the logistics as well as the settling of payments. The Libri platform now has 700 retail partners. The customer chooses whether to collect the goods from the bookshop around the corner or to let Libri.de deliver them, free of postage and packaging costs. An extensive book and CD range – comprising more than one million titles – is backed up by large amounts of supplementary information such as cover illustrations, articles and reviews. Editorial content, prices and delivery deadlines are updated daily on the site. In this way and by appropriate marketing strategies applying interactive agents, Libri.de has become one of the most successful shopping platforms on the web and is developing into Europe’s largest literature portal.

www.sinnerschrader.com/en/stories/libri/ www.libri.de

PROCE SS MODE L

Success: SinnerSchrader Unified Commerce Process I N AS DYNAM IC A MAR K ET AS TH E eB US I N E S S E NAB LI NG F I E LD, IT I S PARAMOU NT FOR CLI E NTS TO WOR K W ITH A PARTN E R W HO OW N S A P ROVE N P ROJ ECT M ETHOD. The constant paring down of time periods for projects together with the increasing complexity of solutions is strengthening this trend. Unlike traditional consulting or software engineering, the conception and implementation of an eBusiness strategy is not a sequential process. The areas of consulting, design and engineering are closely interdependent. Based on the experience gained from many complex eCommerce projects over the past years, SinnerSchrader has developed an iterative tool and rule based project process – the S I N N E R SCH RADE R U N I F I E D C OM M E RCE P RO CE S S [“S UC CE S S”].

The most important elements of “Success” are measurable milestones, which document project progress as well as standardised project documents, which promote the transformation of project knowledge into the company-wide knowledge management system. A further important component presents a binding routine that delivers a concrete procedure model for the interplay between team and client on the basis of milestones and documents. With “Success”, SinnerSchrader owns a project approach that allows the scaling of successful business models without either compromising quality or increasing project risk.

standardised and tested project runs on the basis of uniform milestones and project documents (deliverables), guaranteeing the successful implementation of complex eBusiness projects within the shortest possible time period. S U CCE S S:

S U C C E S S S TO RY

wap car

S U C C E S S S TO RY

Our WAP solution was developed at warp speed: on the basis of the existing web application within a few days.

KATJA AN ETTE B RAN DT

Managing Director (Marketing, Communication and Sales) Europcar Autovermietung GmbH

eserve a car online and pick it up on site? The recipe for the success of Europcar on the Internet is that simple. The technology behind it is of course more complex: it is the first data base supported rental station on the web with a real time reservation system. At www.europcar.de, one of the most innovative eCommerce applications, everything is focused on customised mobility and services, as it is at the green stations. The online ordering system is exactly tailored to fit customer needs. The best value conditions are always chosen automatically and the customer receives a confirmation on his printer, quickly and simply. Business customers can integrate an individualised Extranet page with their Intranet and thereby rapidly access the company specific conditions. Additionally, Europcar offers a reservation solution, with which it is possible, for the first time, to rent vehicles via Internet compatible mobile phones. Due to the successful integration of web and WAP commerce solutions, Europcar customers can pick vehicles from three categories on their mobile display and freely choose the place as well as the length of rental. As confirmation of reservation they immediately receive an SMS.

www.sinnerschrader.com/en/stories/europcar/ www.europcar.de wap.europcar.de

S T R AT E GY

eVentures S I N N E R SCH RADE R FOLLOWS A C ON S I STE NT “TI M E-TO -VALU E” AP P ROACH THAT I S ALIG N E D TO RAP I D S HAR E HOLDE R VALU E G ROW TH ON TH E CLI E NT’S S I DE. In the past, this has often resulted in the generation of extremely large increases in shareholder value. This success has motivated SinnerSchrader to scale its leading knowledge in development, implementation and marketing of eCommerce solutions by taking equity stakes in clients it serves. After careful consideration, SinnerSchrader offers to become venture partner of both start-ups and of established companies, which contribute their product knowledge as well as their logistical and financial strenght. SinnerSchrader does not come in expressly as a venture capitalist, but sees its role more as the conversion partner for innovative enterprises. Blume 2000, the leading flower and plant chain in Germany, founded an eFlower company at the end of 1999: the Blume 2000 new media ag. The company has been successfully offering bouquets and plants to the gift and home market at www.blume2000.de since the middle of 2000. An expansion of the business model, the product range and service offerings is planned within the coming months. SinnerSchrader has been involved with LetMeShip GmbH since the beginning of 2000. As an eLogistic hub, this Franco-German enterprise bundles courier and express orders from small and medium-sized customers and passes them on to carriers such as Deutsche Post Euro Express, TNT, DHL, UPS, FedEX, Alphalegatus or Chronopost. As an operator independent platform, LetMeShip.com ensures transparency within a very heterogeneous market and offers significant rationalisation potential to both sender and carrier through the complete digitalisation of the process chain.

VE NTU R E S – A LOG I CAL STE P:

with the development of transaction-centred solutions, a close partnership between client and service provider is created which can lead to actual participation.

S U C C E S S S TO RY

UPS, DHL, XML

S U C C E S S S TO RY

As an eLogistic-hub, the open exchange with third systems is absolutely critical to our success.The solution: XML.

B OR I S WI N K E LMAN N

Managing Director, LetMeShip GmbH

LetMeShip brings together couriers and express orders from ad hoc customers and passes them on to Deutsche Post Euro Express, TNT, DHL, UPL, UPS, FedEX, Alphalegatus or Chronopost, thus effectively operating as an eLogistic hub. As an operator independent platform, LetMeShip.com primarily ensures transparency in a very heterogeneous market and offers rationalisation potential to both sender and carrier through the complete digitalisation of the process chain. Providing a direct cost and performance comparison of the supplier, the complex tariff systems of the nationally and / or internationally operating courier and express service providers are brought together in an object oriented data base. LetMeShip determines each of the available services and presents an overview of their transport costs and performance. Thereafter, orders can be placed directly on a uniform interface. In the same way, the placing of billing is executed electronically on the basis of individual booking data. Thanks to large numbers of XML interfaces, LetMeShip can offer seamless logistics services, to portals as well as to eRetailers.

www.sinnerschrader.com/en/stories/letmeship/ www.letmeship.com

I N T E R N AT I O N A LI S AT I O N

Go northsouthwest

OSLO

S I N C E S I N N E R S C H R A D E R WA S F O U N D E D I N G E R M A N Y – E U R O P E ’ S M O S T I M P O R TA N T I N T E R N E T MAR K ET – IT HAS DEVE LOP E D A LEADI NG MAR K ET P OS ITION as a provider of high-end eCommerce solutions. This position offers ideal conditions for further expansion into the entire European market. In addition, the flotation has established the financial background necessary for such expansion. However, sufficient financial resources are not the only prerequisite for successfully growing an European business. Equally important is the expansion of orientation and thinking of the existing organisation towards international and intercultural contexts as an essential milestone for any successful internationalisation strategy. Consequently, SinnerSchrader is following a three-step approach to European expansion. The first step is to support the internationalisation of clients within the existing German client base, as well as to obtain foreign clients with pan-European plans. SinnerSchrader has already made headway here with the adaptation of the Ricardo auction platform for the English market www.goricardo.co.uk and the expansion of the LetMeShip application for the French market, along with the acquisition of new clients in the Netherlands (Ineas) and Norway (Coshopper). The second step is to support the organic growth of offices within chosen European countries, offices which are to both look after German clients locally and also to pitch for new business within relevant local markets. The opening of the first subsidiary, SinnerSchrader UK Limited, marks the successful beginning of this phase. Within the first few months of operation, SinnerSchrader UK Ltd. has already acquired local clients, in addition to managing Europcar.co.uk and GoRicardo.co.uk. In a third step, SinnerSchrader will accelerate the process of internationalisation through selected acquisitions. First options have already been evaluated in the past business year.

LONDON

AMSTERDAM

PARIS

HAMBURG

FRANKFURT

MUNICH

I NTE R NATI ONAL PR OJ E CTS I N TH E PR EVI OU S YEAR:

Amsterdam, Frankfurt, Hamburg, London, Munich, Oslo, Paris.

S U C C E S S S TO RY

intersurance

S U C C E S S S TO RY

We are not a direct seller, but a self service restaurant: the secret are simple, quick and standardised products.

FRAN K LEYHAU S E N

Campaign Manager Europe Ineas Insurance Company N. V.

he Ineas Insurance Company N.V., Europe's first online insurer, has also been offering its services to German customers since March 2000. To accompany this development, SinnerSchrader relaunched this site taking into consideration that the siteâ&#x20AC;&#x2122;s easy adaptability is a crucial characteristic. In the context of European expansion, county-specific content needs to be edited locally with utmost case and speed. In addition, considering the various stages of development of the net infrastructure within Europe, the site has also been optimised for extremely short loading times. Through the seamless integration of the web processes into the back-end system, Ineas consistently draws out rationalisation potential and at the same time offers the customer a visible service advantage.

www.sinnerschrader.com/en/stories/ineas/ www.ineas.com

E M P LOY E E S

Pioneer Culture S I N N E R SCH RADE R P ROVI DE S A H IG H LY S P ECIALI S E D S E RVICE THAT R EQU I R E S IT TO W I N OVE R AN D

integrate the best talent in the industry. Along with attractive clients and projects, SinnerSchrader succeeds in creating an environment that develops and promotes the intellectual capital of our employees to the optimum level. Our unique business culture provides the conditions for this, bonding all employees closely together regardless of status or location.

E M P LOY E E S

Maintaining and strengthening this business culture is so important to us that we support it with a whole range of measures. An open office architecture and many common events â&#x20AC;&#x201C; from a daily breakfast to heavily subsidised memberships of health and fitness clubs â&#x20AC;&#x201C; allow numerous opportunities for informal communication. Perhaps the most important component is our significant investment in the continued training and development of our staff. As a result, we have been able to better our targeted staff level of 124 employees by more than 40 % to 174 employees by the end of the fiscal year. In all, our employee numbers actually rose by 180 % during the business year.

180 %

RAPI D G R OWTH:

through organic growth, employee numbers increased last year by 180 %.

S U C C E S S S TO RY

flower tower

S U C C E S S S TO RY

The integration of all sales channels – web, branches and call centres – is our top priority.

D R. M I R KO KOS CHYK

Chief Marketing Officer (CMO), Blume 2000 new media ag

lume 2000 – the largest German flower chain – is a successful example of how established market leaders can intelligently combine offline and online business. In order to use the potential of its high market recognition as well as established distribution and logistics structures, Blume 2000 decided on a consistent multi-channel-strategy: web, retail outlets and call centres are all seamlessly integrated on a uniform platform. Customers can not only order over the Internet around the clock, but soon will also be able to order bouquets and plants at branches using a kiosk system (“Flower Tower”). Telephone and fax combine to form the third ordering channel. Using an independent back-office application based upon Java/Swing technology, call centre staff are able to access the eCommerce application directly, can record orders in input masks and can competently answer service queries because of the transparent order status tracking system (“Track & Trace”). The latter is for a further component to the solution: a direct connection to the logistics and payment system of the post eCommerce services.

www.sinnerschrader.com/en/stories/blume2000/ www.blume2000.de

O U T LO O K

One step – the next steps

O U T LO O K

Development of internet investment in Europe SOURCE:

IDC, Datamonitor

TH E G ROW TH OF TH E MAR K ET FOR eB US I N E S S SOLUTION S HAS ON LY J UST B EG U N. R E NOW N E D R E S EARCH I N STITUTE S P R E DICT A FOU R-FOLD I NCR EAS E I N I NVE STM E NT I N I NTE R N ET S E RVICE S AN D

Germany is predicted to remain the largest European market, closely followed by Great Britain. Other European countries are also growing rapidly and have already reached an interesting size. The attraction of the market for eBusiness solutions has also led, however, to a significant increase in the number of companies offering these services. In particular, established firms from related sectors have developed own offerings and solution competence within the eBusiness service area. SinnerSchrader was, in 1996, one of the first in Germany to build up business focused on eCommerce solutions from the beginning consistently integrating the necessary consultancy, design and technology competencies. We remain committed to this business concept. The organic development of knowledge, experience and capacity – also at the forefront during the business year 1999/2000 – has made SinnerSchrader a leading eCommerce enabler with an advantage over its its competition. In order to fully utilize growth potential, we are also pursuing growth through acquisitions, alongside this path of organic growth. Our goal is clear: we want to be positioned as one of the top three providers of complex eBusiness solutions in Europe. Command of the continual technological challenge is a deciding factor for success. Consequently, our acquisitions strategy aims firstly at strengthening our technological competence. The take over of Netmatic Internet/Intranet GmbH shortly after the end of the business year 1999/2000 – subject to agreement at the AGM – marks our first successful step in implementing this strategy. The second thrust of this strategy is towards regional expansion. During the business year 2000/2001, SinnerSchrader intends to establish itself within three more European markets, in addition to that of Great Britain. We will then be in a position to better support our clients in the implementation of Europe-wide business concepts. Based upon our concepts and methods, we will also strike to participate in the respective regional growth. Through the take over of Netmatic we will also be presented with a small team, in the USA, for the first time. Finally, this expansion abroad will be accompanied by expansion to at least two additional locations within Germany itself. To sum up, we are striving for our turnover during the business year 2000/2001 to double that of the previous year. We also want to increase our operating profit before possible depreciations of goodwill. Our targets are high and they are only attainable if SinnerSchrader succeeds in enthusing the people who are constantly putting them into action. Offering our staff an environment that provides suitable conditions for development is a constant challenge. We are currently in the process of setting up a new eCommerce “factory” in Hamburg, in order to address this challenge and to provide a stimulating environment for 450 employees. eB US I N E S S SOLUTION S.

Internet investment in Europe for 2003 SOURCE:

IDC

S TO C K

514190 –Internet stock with P/E-Ratio S I NCE 2 NOVE M B E R 1999, WKN 514 190 STAN DS FOR S I N N E RSCH RADE R AKTI E NG E S E LLSCHAFT ON TH E

and for the successful combination of Internet, growth, and profitability. In the past fiscal year, the launch on the stock exchange was the most important event for SinnerSchrader. In intensive discussions with analysts and fund managers, SinnerSchrader presented its clear positioning as a leading service provider for high-end eCommerce solutions in Germany. The result: a twenty-eight fold oversubscription of the share offering, an issue price of 12  at the high-end of the bookbuilding range, and a first closing price of 21.50 . The strength of SinnerSchrader’s business model has convinced many prestigious investors from Great Britain, Italy, Switzerland, the USA, and Germany. Of the 2,475,000 shares placed on the market (including the greenshoe) 65 % were sold to institutional investors and 35 % to private investors. Net proceeds totalled DM 54.8 million and went completely to the company to finance the growth strategy. As a result of the flotation, 24.8 % of the total of 9,975,000 shares outstanding are free float. 51.7 % of the shares are controlled by Oliver Sinner and Matthias Schrader (approx. 2 % have been lent as security loan). A further 8.6 % are owned by SinnerSchrader management, with the remaining 14.9 % being held by strategic investors. Since launching on the stock exchange, the stock price has become an important measure for the success of the work at SinnerSchrader. A dynamic development in share value inspires confidence in our shareholders, which in turn acts to create the basis for developing further innovation and growth potential. Not least are the SinnerSchrader employees part of this consideration, as their compensation and motivation are dependent upon the value development of SinnerSchrader stock due to the consistent use of stock options as a means to create equity participation. Following erratic fluctuations on the technology stock markets, however, it is questionable whether short-term share price movements – be it up or down – are a realistic reflection of the true value development. On 31 August 2000, the SinnerSchrader share price stood at 33.40 , just over 180 % higher than the issue price and about 55 % above the first day’s closing price. Over the time period since 2 November 1999, SinnerSchrader shares have performed below the level of the Nemax-All-Share-Index. However, the SinnerSchrader stock outperformed the Internet subindex since it has been first published on 15 May 2000. The latter comparison is already indicative of the strength of SinnerSchrader’s business model. “N E U E R MAR KT” I N FRAN KFU RT –

SinnerSchrader's goal is to dynamically, and above all steadily, increase its business value over a number of years. A crucial building block for this is our committed and active investor relations work. The aim of this work is to instil confidence through the provision of transparent, rapid and comprehensive information; short-term effects on share price are not the goal. SinnerSchrader has always striven to make information concerning business development, planning and strategy publicly available: at national and international conferences, for example in Frankfurt, Berlin, Milan and London last year; during one-to-one meetings with investors and analysts at SinnerSchrader's “eCommerce factory” in Hamburg; at road-shows; and also through intensive work with the trade and financial press. Personal contact is always supplemented with detailed and up-to-date information on the Internet. In-depth data and information is available worldwide at www.sinnerschrader.com or also at www.wkn514190.de. The Stock

German securities code number

514 190

Symbol

SZZ

Stock exchange

Frankfurter Wertpapierbörse (Neuer Markt)

Indices

Nemax All Share, Nemax Internet Index

Shares in circulation (31.08.00)

9,975,000

Issue price

12.00 

Business year end share price (31.08.00)

33.40 

High/low share price (02.11.99 – 31.08.00)

91.00 / 18.00 

Ø - Sales volume (02.11.99 – 31.08.00)

49,846 shares per day / 1.8 million 

Market capitalisation (31.08.00)

333.2 million 

Stock results

Result per share

0.20 

Price to profit ratio

167 x

G LO S S A RY

A Adtraction Adtraction is one of the technologies SinnerSchrader has developed to rate advertising success; it enables online media campaigns to be uniformly tracked, assessed, optimised and refined.

B Back-office Web-based back-office application, through which the website operator can control all processes and administer all data (order data, CRM-Systems).

Broadband Transmission channel with a bandwidth of at least 768 KB, sufficient, for example, for the broadcast of a film in real time. The bandwidth refers to the transmission capacity of a distribution system and is shown in Bit or Mbit per second.

C Caching A cache is an intermediate storage system that saves frequently needed data on a rapid memory medium. This intermediate storage system can be realised as hardware or software. The reason for caching is to increase speed.

G LO S S A RY

Clickstream

A Clickstream consists of the sequence of pages called up (“clicks”) by a user within a specific time period.

Content Management Systems Content Management Systems (CMS) are editing systems that support the creation and administration of editorial content for websites.

Corba The abbreviation for “Common Object Request Broker Architecture”. Corba is the standard that defines the communication between separate applications. Corba is system independent and is not restricted to any one programming language. CRM

CRM (Customer Relationship Management) refers to the use of specific methods and programmes that allow businesses tool-based analysis and organisation of their customer relations.

EJB

Abbreviation for “Enterprise Java Beans”. A model for the development of Java components within a distributed multi-tier environment. An EJB is a server oriented portable component which focuses on the business logic of an application.

and so attains a transmission speed of up to 171 KBit/s. GPRS is based on the use of single data packets and does not send a constant stream of data.

“Graphical User Interface” (GUI) is the technical reference to the graphical user interface of, for instance, Windows or Swing.

ERP

ERP – Enterprise Resource Planning Systems – refers to application software that integrates the all business process of an enterprise into one multi-modular system.

Experience Models Experience Models, set up on the basis of scientific experience, practical testing and comprehensive market analysis, allow for a detailed reconstruction of contact with the Internet by the user. A vivid profile of customer behaviour is produced, which then offers important insights into brand loyalty, purchase motivation, product use and marketing strategy.

Data-mining

Data analysis, in large data bases, in order to uncover hidden relationships between transactions and information, leading to business related decisions.

GPRS

The GPRS technology (General Packet Radio Service) is the preliminary stage to UMTS and supports cordless transmission speed which is rapid enough to surf on the Internet in full colour. GPRS uses a number of transmission time slots simultaneously (Multislot-technology)

GUI

Java Java, developed by Sun Microsystems, is a platform independent object oriented programming language.

K Kiosk-System Kiosk-systems are computer based information enquiry and transaction systems that support new types of distribution. Their broad spectrum ranges from product information systems, to electronic guiding aids for retailers to point of information systems in public places, airports or train stations, through to interactive TV-shopping.

Middleware

U Usability

Middleware links the user interface with the existing back-end system on the basic of leading industry standards Java, EJB, Corba or XML .

User friendliness of a website, achieved by clear design and with a clearly structured navigation that generate greater “stickiness”.

Multi-tier-architecture In multi-tier-architecture, usually three-tier-architecture, a distinction is made between data storage, application logic and presentation level. This separation allows for a modular, flexible, scaleable system architecture.

W WAP

WAP (Wireless Application Protocol) is a protocol defining the broadcast and presentation of specialised Internet content on appliances with reduced presentation space such as mobiles or handhelds (PDAs).

Abbreviation for “Personal Digital Assistant”; often a compact computer with calendar and message function. Also referred to as a Handheld.

PDA

S Swing A Java class library. Part of the JDK 1.2 (Java Development Kit) from Sun Microsystems. Swing simplifies the production of standardised and upmarket user interfaces such as those known from Windows or Apple.

XML XML (Extensible Markup Language) is a standard for the definition of platform independent, structured data formats. XML, like HMTL, is also a part of SGML (Standard Generalised Markup Language). While HTML is used for representation, XML can describe data definition.

C O N S O L I D AT E D S TAT E M E N T S

of SinnerSchrader Aktiengesellschaft 1999 / 2000

J O I N T S TAT U S R E P O R T O F TH E S IN N E RSCHRADE R G ROU P AN D TH E S I N N E RSCHRADE R AKTI E NG E S E LLSCHAF T FOR TH E F I SCAL YEAR 1 9 9 9/2000

C O N S O L I D AT E D B A L A N C E S H E E T S

C O N S O L I D AT E D S TAT E M E N T S O F O P E R AT I O N S

C O N S O L I D AT E D S TAT E M E N T S OF S HAR E HOLDE R S’ EQU IT Y

C O N S O L I D AT E D S TAT E M E N T S O F C A S H F LO W S

N OT E S TO T H E C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S

S U M MARY OF S IG N I F ICANT DIFFE R E NCE S B ETWE E N US-GAAP AN D G E R MAN LAW W ITH R EGAR D TO A C C O U N T I N G , VA L U AT I O N A N D C O N S O L I D AT I O N P R I N C I P L E S

A U D I TO R S ’ O P I N I O N G R O U P

J O I N T S TAT U S R E P O R T

Joint status report of the SinnerSchrader Group and the SinnerSchrader Aktiengesellschaft for the fiscal year 1999/2000 I.

GENERAL

The SinnerSchrader Group (“SinnerSchrader” or “Group” ) is made up of SinnerSchrader Aktiengesellschaft (“SinnerSchrader AG” or “AG” , a joint stock company or PLC) and its subsidiaries Sinner+ Schrader Interactive Marketing GmbH (“SinnerSchrader IM” ), Sinner+Schrader Interactive Software GmbH (“SinnerSchrader IS” ) and SinnerSchrader UK Limited. SinnerSchrader is one of Germany’s leading consultancy and service companies for the development, design and implementation of eCommerce and eBusiness solutions. SinnerSchrader AG performs the functions of a managerial holding company. The consultancy and services business is carried out by the subsidiaries, and the status of SinnerSchrader AG is therefore reported on together with that of the Group. Unless specific reference is made to the AG, the information provided refers to the Group. The Annual Accounts for the Group were drawn up in accordance with § 292a HGB (German Commercial Code) with discharging effect, on the basis of US accounting principles (“US-GAAP” ). The individual accounts of the AG are produced in accordance with German accounting rules. The fiscal year 1999/2000 of the AG and the Group ran from 1 September 1999 to 31 August 2000. In the following report on the Group’s business development, comparisons with previous periods are based on the accounts from the partial fiscal year 1999 from 1 January 1999 to 31 August 1999, and the fiscal year of 1 January 1998 to 31 December 1998.

II.

MARKET AND COMPETITIVE ENVIRONMENT

The number of Internet users has grown explosively over recent years, and against this backdrop the Internet has asserted itself over the past year and a half in Europe, particularly here in Germany, as a platform for the buying and selling of goods and services. The number of Internet users in Europe has risen from 24 million in 1998 to more than 92 million in 2000; in Germany this figure has grown from 10 million to 18 million. The value of transactions performed over the Internet within the same time period is estimated to have risen from DM 12 billion to DM 135 billion in Europe and from DM 4 billion to DM 35 billion in Germany. This indicates that the status of the Internet has developed from that of a presentation and communication medium to that of a transaction platform. Shaped by this progress, the demand for consultancy and implementation services for Internetbased business strategies is also growing extremely fast. Estimates of the average annual growth rate from 1998 to 2000 fluctuate between 80 % and 120 % for Europe, while Europe’s share in the world market for these services has also grown. The market development during 1998 and 1999 was heavily characterised by the start-up enterprises of the so-called New Economy, whereas the growth dynamic of the Internet services market has more recently been spearheaded by the com-

panies of the Old Economy who have recognised the strategic necessity for developing and putting into practice an eCommerce strategy. Furthermore, the expansion or transferral of business processes onto the Internet is increasingly becoming an initiating factor for a fundamental reexamination of business processes. The business model of the “integrated eCommerce enabler” has evolved among pure Internet service providers as a service that combines the three fields of consultancy, design and technical implementation within one integrated process. Numerous companies from this sector have been listed on the world’s stock exchanges over the past 18 months, and the capital absorbed as a result has placed them on an aggressive, often acquisition-based growth course. Another consequence of the success of the Internet has been that established enterprises in the IT service and advertising industry have forced their way into the Internet market and begun to offer their own services.

III.

D EVE LOPM E NT AN D POS ITION OF TH E G ROU P

Since its foundation in 1996, SinnerSchrader has consistently developed its business model of an integrated eCommerce enabler, and by focussing early on the market for transactional Internet applications the company has achieved an excellent position in the German market. Within this process of evolution, SinnerSchrader has always managed to combine business expansion with profit growth. SinnerSchrader has maintained this successful business development over the fiscal year 1999/ 2000. The year was marked on the one hand by the organic expansion of the organisation and the actualisation of growth opportunities in the German market with many existing and new clients. On the other hand SinnerSchrader also succeeded in creating the conditions for further growth in Europe, by launching itself on the stock exchange on 2 November 1999, by sharpening its technological profile, by preparing for acquisition moves, and by beginning its internationalisation through the setting up of a London office. Revenues tripled

J O I N T S TAT U S R E P O R T

By retaining clear market positioning, SinnerSchrader upheld the high levels of growth of previous years. Revenues during the fiscal year 1999/2000 rose to DM 28.7 million as opposed to DM 8.4 million over the first eight months of 1999. This corresponds to a growth of 241%. DM 19.1 million of these sales were generated by Project services, compared with DM 5.5 million during the partial fiscal year 1999, a rise of 244 %. SinnerSchrader successfully launched more than 20 eCommerce/eBusiness solutions for its clients during the fiscal year 1999/2000. The share in total sales claimed by Project services was 66.5 % during the fiscal year, slightly higher than its share during the first eight months of 1999, but still beneath the strategic target range of 70 - 75 %. In its Media services business SinnerSchrader achieved revenues of DM 7.6 million, approximately 150 % more than in the partial fiscal year 1999. The share of this in total sales for 1999/2000 was 26.5 %. For the establishment of client relationships with foreign clients, the Media services provide an attractive link-point. The service offering to our clients also in the marketing phase of a website has become one of SinnerSchrader’s firmly established services. Other services generated DM 2 million of sales, around 7 % of total turnover. A large proportion of this figure resulted from sales of hardware and software, which clients requested us to buy in as part of the technical consultancy for, and operation of, the eCommerce solutions we created. Sales from Other services were still comparatively low in previous years. Client basis expanded considerably

With regard to its vertical structures, SinnerSchrader’s client portfolio shows a clear emphasis on eRetailers. Other prominent shares are accounted for by the finance and corporate/eMarkets industries. Organic growth

SinnerSchrader has kept pace with the growth in its business purely through the organic expansion of its organisation. The number of employees rose from 62 at the end of August 1999 to 174 at the end of August 2000. This growth was enabled because of attractive projects, a prominent corporate culture, flat company hierarchies, and not least by people’s increased awareness of SinnerSchrader as a result of its flotation on the stock exchange. Employee growth was particularly strong in the engineering department due to the increasing technical complexity of the solutions that SinnerSchrader designs and implements. In this field the team was built up from 22 at the end of the previous period to 60 at the end of the fiscal year 1999/2000. The challenge is to gain the loyalty of our employees. To succeed in this, SinnerSchrader offers a balanced total package of cultural and financial elements, speaking to the individual employee as a whole person, and providing him with the opportunity for broad personal development. The share options available to every employee are an important element of this package, allowing them to share in the success of the company. By the end of August 2000, 165,300 options had been issued to employees from the 1999 Stock Option Plan at an average striking price of  32.96. After adjustment for part-time employment, an average of around 103 people were employed by SinnerSchrader during the fiscal year 1999/2000, as opposed to around 38 in the partial fiscal year 1999. The total revenues per employee were therefore approximately DM 279,000 in 1999/2000. Average sales from Project services were approximately DM 186,000. These figures, during the previous period, were approximately DM 330,000 and DM 218,000 respectively. The fall in per-employee sales was expected and was primarily a result of the necessary expansion of central administrative functions, especially in the personnel, financial and controlling departments. Furthermore, the settling-in period for new employees to the point of full productivity has risen, among other things because of the increased complexity of projects. Despite this fall in per-capita sales, however, SinnerSchrader’s employees are still among the most productive in the industry. Operating income doubled, operating profit margin at nearly 23 %

This rise in revenues compared with the previous partial fiscal year has resulted, in approximately equal measure, from business with both existing and new clients. This shows that SinnerSchrader has succeeded in utilising the growth potential of the existing client portfolio without neglecting expansion. 16 new clients chose SinnerSchrader during 1999/2000 as the company to realise their Internet-based business strategies, signifying a reduced dependency on individual clients in comparison with previous periods. SinnerSchrader generates around 62 % of its revenues from its six biggest clients; in the previous partial fiscal year this figure was 70 %. Five clients accounted for sales of more than DM 2 million during the fiscal year, while the next three clients generated sales of more than DM 1 million during the year.

As a consequence of high employee productivity, the success of the projects on which SinnerSchrader is working, and the consistently low sales costs, SinnerSchrader succeeded in achieving an operating profit margin of 22.9 % during the fiscal year 1999/2000, placing the company firmly at the peak of the industry. In absolute terms SinnerSchrader achieved an operating income of DM 6.6 million in 1999/2000, 133 % or DM 3.7 million more than in the first nine months of 1999. As expected and announced, the operating profit margin was lower than the previous period’s 33.6 %. Aside from the factors already mentioned, other notable causes of this were: the increase in legal and consultancy costs, the costs of an image campaign linked with the stock exchange flotation, the fact that a discount on client accounts receivable was allocated to bad debt allowences for the first time, and the cost of setting up the office in London. A limited amount of costs were also incurred in the development and evaluation of basis technologies. The net income for the year 1999/2000 was DM 3.8 million, 187 % more than in the previous 8-months period. Because of the financial result made possible by the earnings from the stock exchange listing, the annual net income margin was 13.4 %, only slightly less than in the previous period.

J O I N T S TAT U S R E P O R T

The result per share reached DM 0.40 on a diluted basis, an increase of 81 %. The effect of the higher net income for the year was partially compensated for by the increased number of outstanding shares after the flotation.

Listing on stock exchange creates basis for further stages of growth

With the successful placement of around 2.5 million shares on the Neuer Markt (New Market) of the Frankfurt Stock Exchange SinnerSchrader has paved the way for the continuation of its dynamic growth. The significant strengthening of the equity capital base and the influx of DM 54.8 million of cash resources after deduction of the costs of the placement, as well as the possibility of taking over companies using shares, has given SinnerSchrader new room for manoeuvre. However, the objective is not the short-term acceleration of growth in sales. Instead we are keen to continue developing SinnerSchrader in such a way that a basis is formed for medium and long-term value growth. To this end, SinnerSchrader sees its job firstly as widening its technological competence, and secondly as expanding the basis of its business in other European countries. The balance sheet structure is basically shaped by the effects of the launch on the stock exchange. With DM 66.1 million equity capital, the equity ratio is more than 87 %. Cash resources and shortterm investments amounting to DM 60.7 million dominate the assets section. Alongside this, accounts receivable from trade debtors are prominent at DM 8.3 million. Significant tax positions are on both sides of the consolidated balance sheet, with DM 3.4 million of outstanding tax debts balanced off by around DM 4.1 million of tax reserves (without deferred tax liabilities). Te c h n o l o g i c a l c o m p e t e n c e i s t h e d e c i s i v e c o m p e t i t i v e f a c t o r

Ta x p a y m e n t s l e a d t o n e g a t i v e o p e r a t i v e c a s h f l o w

In spite of the successful development of business, cash flow from operating activities was negative at DM -0.6 million during the fiscal year 1999/2000. One of the reasons for this is that SinnerSchrader had to pay significant provisions for income taxes for the first time, approximately DM 2.1 million. But a sharp rise in client accounts receivable by DM 7.3 million net, or including services not yet invoiced by DM 1.6 million, was also negatively affecting the cash flow from operating activities. The average age of receivables was 45 days. This places SinnerSchrader in a relatively good position for the industry, although it is still our aim to reduce capital tied up in client accounts receivable relative to sales.

SinnerSchrader is convinced that the mastery and continuous expansion of technological expertise is the key factor for its future success as an eCommerce/eBusiness enabler. For this reason, the sharpening of its technological profile was one of the tasks in which SinnerSchrader was especially involved during the fiscal year 1999/2000. The fact that SinnerSchrader was one of the first service providers in Germany to establish a WAP-based mCommerce solution for a client at the end of January is evidence of the company’s potential. Another decisive step towards continued development was the combining of experience and expertise from the previous eCommerce solutions in the Unified Commerce Platform, to form a basis for the development of new client projects. The technological platform will be complemented by a unified commerce process model with which SinnerSchrader will be able to create successful eCommerce and eBusiness solutions with even greater efficiency. Also, by establishing a competence centre for Intershop Enfinity, SinnerSchrader has extended its technological range to include one of the most promising standard products in the market for eCommerce solutions.

Start of work with ventures

In accordance with its venture strategy, SinnerSchrader began work with two partner companies in the fiscal year 1999/2000. Business models were successfully launched on the Internet for both LetMeShip GmbH and Blume 2000 new media ag. In the weeks following the end of the fiscal year, LetMeShip GmbH’s application won its first eBusiness award. The aim of the venture strategy is to retain minority shareholdings of up to 20 % in the partner companies. This is legally secured in both ventures, although the corresponding capital subscription has in part not yet been possible, with the result that the effects of the planned investments impacted only slightly on the cash flow for investing activities on the one hand and the investment assets on the other. Investments in tangible assets of approximately DM 1.1 million were made, mainly for equipping employees’ workplaces, purchasing software and extending the central hardware infrastructure.

IV.

D EVE LOPM E NT AN D POS ITION OF TH E AG

SinnerSchrader AG is the managerial holding company of the SinnerSchrader Group. Shares in SinnerSchrader AG have been traded on the Neuer Markt of the Frankfurt Stock Exchange since 2 November 1999. The business activities of SinnerSchrader AG centre around the management of the fully owned subsidiaries, the central handling of administrative tasks for the Group, the management of the majority of the Group’s cash resources, the management of other investments, and the performance of central Group tasks.

J O I N T S TAT U S R E P O R T

The main event for the AG in the fiscal year 1999/2000 was its admission to the Neuer Markt of the Frankfurt Stock Exchange, and the placement of 2,475,000 shares at the beginning of November 1999. The listing created an influx of DM 58.1 million to the AG, while the costs of the flotation were DM 3.3 million, which are included as other operating expenses in the AG’s profit and loss statement. During the course of the year, cash resources were put into interest-bearing investments and marketable securities (including money-market investment funds) with a duration of no more than three months, offered by banks with good financial standing. This created interest earnings of DM 1.2 million, DM 10,000 of which resulted from the financing of affiliated companies. Other income and expenses that applied to financial items, stemming from buying and selling of the marketable securities, currency exchange rate hedges, fees and commissions are included under other operating income/expenses. They amounted to DM 0.3 million net. The AG generated a turnover of DM 0.9 million by performing managerial functions for the subsidiaries. Dividend payouts from the subsidiaries also generated investment income of DM 5.5 million for the AG. Major items balancing this on the other side, in addition to the costs of flotation, were personnel costs of DM 1.2 million and other operating expenses of DM 2.9 million, in particular for legal services, consulting and advertising. This produced a result from ordinary business activities of DM 1.1 million (previous year DM 0.2 million). After around DM 0.4 million in taxes, primarily commercial tax, the remaining net profit for the year was DM 0.7 million (previous year DM 0.2 million). The assets side of the balance sheet consists mainly of cash resources and securities amounting to DM 59.8 million (previous year: DM 4.0 million) and equity interest of DM 16.1 million (previous year: DM 16.0 million). The other assets of DM 3.7 million (previous year: DM 0.0 million) were dominated by receivable income tax and turnover tax; accounts due from affiliated companies amounted to DM 1.5 million. Opposing this on the liabilities side was mainly the equity capital of DM 78.6 million (a DM 0.1 million deficit was not covered by equity capital the previous year).

RISKS OF FUTURE BUSINESS

The future business development of SinnerSchrader is subject to risks which could have a negative effect on its earnings and financial situation, or which could mean that SinnerSchrader fails to achieve its development objectives. These risks are related principally to the volatility of the, still young, market for Internet services, to SinnerSchrader’s relatively short business history, and to the strong growth which the Group intends to achieve. The risks relate to the following potential scenarios (this is not an exhaustive list): A slowing of the growth of investment in Internet-based business models, and an increase in competitive intensity above that which is predicted. Higher costs and integration effort for future acquisitions, as well as the need to depreciate goodwill from acquisitions in a way that effects the results. Dependency on key employees and the need for a continuous intake of qualified staff. Dependency on a few clients who make up a significant share of sales, and the economic failure of clients in whom SinnerSchrader has invested. Overstepping costs in fixed price projects, suffering quality difficulties in the delivery of service.

The Management Board of SinnerSchrader Aktiengesellschaft considers it one of its main tasks to continuously evaluate the risks with regard to a) their potential effect on earnings and finances and b) the likelihood of them occurring, and to introduce suitable measures if necessary.

VI.

E V E N T S A F T E R T H E R E P O R T I N G D AT E

On 15 September 2000 SinnerSchrader and the other shareholders of LetMeShip GmbH approved a capital increase in which SinnerSchrader and a third-party investor would subscribe new shares against cash. As part of this increase SinnerSchrader will contribute DM 300,000. On 18 September 2000 SinnerSchrader signed an agreement with the shareholders of Netmatic Internet/Intranet Solutions GmbH relating to the contribution of 100 % of the shares in Netmatic. Netmatic Internet/Intranet Solutions GmbH is a profitable eCommerce software specialist with more than 50 employees and predicted sales of DM 10 million for the year 2000. The agreement has still to be approved by the General Meeting of Shareholders in accordance with § 52 of the Aktiengesetz (German Stock Corporation Law). If this approval is granted, SinnerSchrader will have considerably expanded its technological competence with this first take-over, and acquired crucial know-how and attractive customer links in the field of programming on the basis of WebObjects. The price of the takeover is not yet finalised; it will be based on Netmatic’s sales and pre-interest, pre-tax profits during the year 2000. An initial purchase price instalment of DM 30 million, which also represents the lower purchase price limit, will be due following approval by the General Meeting of Shareholders. A small percentage of the purchase price will be paid in cash, while most of it will be covered by issuing new shares in SinnerSchrader AG from approved capital.

VII.

OUTLOOK

SinnerSchrader is predicting that investments in Internet solutions in Europe will double in the year 2001. The difficulties currently being experienced by pure Internet companies (“dot.coms” ) will only have a temporary damping effect. Because of the successful development of its business during the fiscal year 1999/2000, SinnerSchrader is now in an excellent position for further dynamic growth. The challenge lies in supplementing organic growth, which will be pursued vigorously, with acquisitions. The focus of these acquisitions will be technology and regional expansion within Europe. The takeover of Netmatic Internet/Intranet Solutions GmbH was a successful start in this respect. SinnerSchrader is expecting sales to double during the fiscal year 2000/2001, and predicts a further absolute rise in its operating result before any adjustment for goodwill depreciation which might occur. However, the operating profit margin will, according to current estimates, come in at below 20% on account of the expenditure necessary for growth.

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

Consolidated balance sheets

Consolidated statements of operations

as of 31 August 2000 , 31 August 1999 and 31 December 1998

for the fiscal year ended 31 August 2000 , the period from 1 January 1999 to 31 August 1999 and for the fiscal year ended 31 December 1998

Assets

31.08.2000 in DM

31.08.1999 in DM

Cash and cash equivalents Short-term investments

01.09.1999 31.08.2000 in DM

01.01.1999 31.08.1999 in DM

01.01.1998 31.12.1998 in DM

01.09.1998 31.08.1999 in DM 1)

Project services

19,068,682

5,548,649

2,717,051

6,632,395

Media services

7,584,759

2,743,550

788,800

3,057,394

31.12.1998 in DM

Current assets:

Revenues

567,158

6,149,889

167,543

60,151,188

Others

Accounts receivable, net of allowances for doubtful accounts

2,023,332

107,500

91,325

128,783

Total revenues, gross

28,676,773

8,399,699

3,597,176

9,818,572

(DM 484,608, previous years: DM 0, and DM 0, respectively)

8,318,657

1,460,095

267,911

Unbilled services

1,648,164

90,054

Media costs

- 6,352,517

- 2,370,250

- 694,893

-2,655,562

Total revenues, net

22,324,256

6,029,449

2,902,283

7,163,010

Cost of revenues

Other current assets and prepaid expenses Total current assets

Property and equipment Investments Total assets

3,639,008

196,112

28,127

74,324,175

7,806,096

553,635

1,122,320

521,177

301,365

143,228

123,670

75,589,723

8,450,943

855,000

- 10,724,951

- 2,319,020

- 1,815,654

-3,039,113

Gross profit

11,599,305

3,710,429

1,086,629

4,123,897

Sales, general and administrative expense

- 5,023,272

- 884,246

- 816,329

- 1,299,467

6,576,033

2,826,183

270,300

2,824,430

57,979

25,600

29,353

34,605

Operating Income 31.08.2000 in DM

31.08.1999 in DM

31.12.1998 in DM

Accounts payable

1,289,257

592,505

156,718

Accrued tax liabilities and deferred tax liabilities

4,766,728

1,776,698

184,242

Other accrued liabilities

2,104,177

439,508

125,694

Liabilities and Shareholders’ Equity Current Liabilities:

Other current liabilities and deferred revenue

1,325,195

217,993

78,400

Total current liabilities

9,485,357

2,963,704

545,054

Other income/other expense, net Financial income, net

1,575,127

12,045

7,726

15,728

Income before provision for income taxes

8,209,139

2,863,828

307,379

2,874,763

- 4,359,942

- 1,524,171

- 214,469

-1,593,807

3,849,197

1,339,657

92,910

1,280,957

0.40

0.22

0.02

0.21

9,563,942

6,025,000

6,000,000

6,016,500

0.40

0.22

0.02

0.21

9,608,278

6,025,000

6,000,000

6,016,500

Provision for income taxes Net income

Net income per share (basic) Commitments and contingencies ( NOTE III.D. )

Shares used in computing basic net income per share

Shareholders’ equity

Net income per share (diluted)

Common stock, par value  1, outstanding: 9,975,000, 7,500,000, 0 shares in 2000, 1999, 1998, respectively

19,509,404

14,668,725

Additional paid in capital, net of equity adjustment

41,275,425

- 10,425,724

243,000

- 48,896

- 50,000

5,142,331

1,293,134

116,946

177,206

Total shareholders’ equity

66,104,366

5,487,239

309,946

Total liabilities and shareholders’ equity

75,589,723

8,450,943

855,000

Receivables from shareholders Retained earnings Accumulated other comprehensive income

The accompanying notes are an integral part of these financial statements.

Shares used in computing diluted net income per share

1) pro-forma

figures unaudited

The accompanying notes are an integral part of these financial statements.

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

Consolidated statements of shareholders’ equity for the fiscal year ended 31 August 2000 , the period from 1 January 1999 to 31 August 1999 and for the fiscal year ended 31 December 1998 COMMON STOCK

Number of shares

Nominal value in DM

Additional paid-in capital, net of equity adjustment in DM

Receivables from shareholders in DM

Retained earnings in DM

Accumulated other comprehensive income in DM

Total shareholders’ equity in DM

Comprehensive income in DM

Balance as of 31 December 1997

–

50,000 - 25.000

- 25,000

24,036

–

49,036

–

Net income

–

––

–

92,910

–

92,910

Contribution of capital

–

50,000 - 25.000

- 25,000

–

25,000

–

Stock compensation

–

143,000 –

–

143,000

–

Balance as of 31 December 1998

–

- 243,000 50.000

- 50,000

116,946

–

309,946

92,910

Net income

–

––

–

1,339,657

–

1,339,657

Payment of receivables from shareholders

–

50.000–

50,000

–

50,000

–

––

–

- 163,469

–

- 163,469

–

Sale of common stock

1,500,000

2,933,745

1,066,256 - 48.896

- 48,896

–

3,951,105

–

Reclassification for formation of stock corporation

6,000,000

11,734,980

- 11,734,980 –

–

Balance as of 31 December 1999

7,500,000

14,668,725

- 10,425,724 - 48.896

- 48,896

1,293,134

–

5,487,239

1,339,657

Net income

–

––

–

3,849,197

–

3,849,197

Unrealised gains on available-for-sale securities (net of tax)

–

––

–

177,056

Foreign currency translation adjustment (net of tax)

–

150

Payment of receivables from shareholders

–

48.896–

48,896

–

48,896

–

Issuance of stock in initial public offering (net)

2,475,000

4,840,679

51,701,149 –

–

56,541,828

–

Balance as of 31 August 2000

9,975,000

19,509,404

41,275,425 –

–

5,142,331

177,206

66,104,366

4,026,403

Distribution of earnings

The accompanying notes are an integral part of these financial statements.

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

Consolidated statements of cash flows

Notes to the consolidated financial statements

for the fiscal year ended 31 August 2000 , the period from 1 January 1999 to 31 August 1999 and for the fiscal year ended 31 December 1998 31.08.2000 in DM

31.08.1999 in DM

31.12.1998 in DM

3,849,197

1,339,657

92,910

Depreciation

425,766

191,684

161,877

Bad debt expense

484,608

Non-cash expense / -revenue

- 71,023

-30,955

143,000

Schrader Aktiengesellschaft (“SinnerSchrader AG” or “Company” ), Sinner+Schrader Interactive

8,485

18,919

Marketing GmbH (“SinnerSchrader IM”), Sinner+Schrader Interactive Software GmbH (“Sinner

- 1,035,671

Schrader IS” ) and SinnerSchrader UK Limited (“SinnerSchrader UK” ). The consolidated companies

Accounts receivable

- 7,343,170

- 1,192,185

-235,242

Unbilled services

- 1,648,164

solutions. The services include eCommerce strategy consulting, user experience design and deve-

Other current assets and prepaid expenses

- 1,685,224

- 77,930

-64,450

lopment, software and systems development and integration, eCommerce solution management

Accounts payable, other liabilities and deferred revenues

1,952,823

426,510

154,064

and maintenance, as well as planning, implementation and controlling of online media campaigns.

Accrued tax liabilities and deferred tax liabilities

2,788,774

1,592,457

162,228

In addition, SinnerSchrader AG holds minority stakes in companies that are concerned with

Other accrued liabilities

1,664,669

313,814

85,658

- 608,930

2,581,971

500,045

30,328

5,134

ber 1997 as limited liability companies. With the aim of functioning as a holding company for

- 1,080,418

- 435,550

- 365,673

SinnerSchrader IM and SinnerSchrader IS, Desideria Vermögensverwaltung GmbH was formed

- 19,558

-6,845

in July 1999 and later on converted from a limited liability company to a stock corporation (“Ak-

- 170,722,369

tiengesellschaft” ) and renamed to “SinnerSchrader Aktiengesellschaft” in August 1999. As part of

Proceeds from sale of short-term investments

111,985,163

the formation of SinnerSchrader AG the shareholders of SinnerSchrader IM and SinnerSchrader

Net cash used in investing activities

- 59,806,854

- 437,261

-365,673

48,896

50,000

the same day, an outside investor purchased a total of 1,500,000 no-par value ordinary shares in

Distribution of earnings

- 163,469

SinnerSchrader AG with a nominal value of  1 – 1,475,000 of which in conjunction with a capital

Contribution to capital

25,000

Proceeds from sale of stock

54,784,157

3,951,105

Net cash provided by financing activities

54,833,053

3,837,636

25,000

Net change in cash and cash equivalents

- 5,582,731

5,982,346

159,372

6,149,889

167,543

8,171

567,158

6,149,889

167,543

Cash flows from operating activities:

Net income Adjustments to reconcile net income to net

I. Organisation and operations of the SinnerSchrader Group

cash provided by operating activities:

Loss on disposal of property and equipment Gain/loss on disposal of market securities (available-for-sale) Changes in:

Net cash provided/used by operating activities

are electronic commerce (“eCommerce” ) consulting and service organisations and serve other

Cash flows from investing activities:

Proceeds from sale of property and equipment Purchase of property and equipment Purchase of investments Purchase of short-term investments

enterprises in the conception, implementation, establishment, and marketing of eCommerce

establishing Internet-based businesses. SinnerSchrader IM was founded in February 1997 and SinnerSchrader IS was founded in Decem-

Cash flows from financing activities:

Payment of receivables from shareholders

As of 31 August 2000 the SinnerSchrader Group (“SinnerSchrader” or “Group” ) consists of Sinner

IS contributed their interest in these companies to a capital increase of SinnerSchrader AG for 6,000,000 no-par value ordinary shares of SinnerSchrader AG with a nominal value of  1. On

increase – for a total cash contribution of DM 4 million. The consolidated financial statements for the periods ended prior to 31 August 1999 have been presented as if SinnerSchrader IM, SinnerSchrader IS, and SinnerSchrader AG had been combined

Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period

The accompanying notes are an integral part of these financial statements.

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

II. Summary of significant accounting policies

C O N C E N T R AT I O N O F C R E D I T R I S K A N D S I G N I F I C A N T C U S T O M E R S

SinnerSchrader extends credit to its customers in the normal course of business, performs ongoing credit evaluations of its customers and maintains allowances for doubtful accounts. A.

B A S I S O F F I N A N C I A L S TAT E M E N T S

The consolidated financial statements have been prepared according to United States generally accepted accounting principles (US-GA AP ). They include the accounts of SinnerSchrader AG and its wholly owned subsidiaries SinnerSchrader IM, SinnerSchrader IS, and SinnerSchrader UK. All significant intercompany transactions and balances between the companies have been eliminated. The accounts have been prepared after making necessary adjustments to the Company’s books and records that are maintained in accordance with the German Commercial Code. All references in the Notes to Consolidated Financial Statements to the periods “1999/2000”, “1999”, and “1998” refer to the periods from 1 September 1999 to 31 August 2000, 1 January 1999 to 31 August 1999, and the year ended 31 December 1998, respectively.

Net receivables from and unbilled services to significant customers as a percentage of total net receivables and unbilled services were as follows:

31.08.2000

31.08.1999

31.12.1998

13 %

17 %

–

Client B

11 %

–

Client C

10 %

–

Client D

25 %

–

Client E

20 %

–

Client F

–

26 %

Client G

–

54 %

Client A

U S E O F E S T I M AT E S

The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ form those estimates.

Gross sales to significant customers as a percentage of total gross revenues were as follows:

01.09.1999 31.08.2000

01.01.1999 31.08.1999

01.01.1998 31.12.1998

17 %

16 %

Client D

12 %

Client E

13 %

Client F

–

13 %

38 %

Client H

11 %

Client G

–

15 %

Client A C.

F O R E I G N C U R R E N CY

The functional currencies of SinnerSchrader’s subsidiaries outside of Germany are the local currencies. The financial statements of these subsidiaries are translated to Deutsche Mark using period-end rates of exchange for assets and liabilities and average rates during the period for revenues, cost of revenues, and expenses. Translation gains and losses are accumulated as a component of shareholders’ equity. Transaction gains and losses are reported in the consolidated statements of operations.

FA I R VA L U E O F F I N A N C I A L I N S T R U M E N T S

SinnerSchrader’s financial instruments, including cash equivalents, marketable securities, accounts receivable, accounts payable, are carried at amounts which approximate fair value.

In July 1999, SinnerSchrader entered into an arrangement with Client A whereby the client would receive a limited amount of services from SinnerSchrader, and, in exchange, SinnerSchrader entered into a convertible debt at par value of  3.500, and has the option to convert the debt into 3,500 shares of Client A at an exercise price of  33 per share. These options expire in June 2004. The option to purchase shares of Client A was valued at the date of grant at DM 116,600 assuming a risk-free interest rate of 5.4 %, an expected life of five years, and expected volatility of 70 %. This amount was first recorded as deferred revenue and later recognised as services were provided to Client A. Approximately 27 % of the hours to be provided under the arrangement were provided prior to 31 August 2000. The remaining 63 % were delivered in the first quarter of fiscal year 1999/2000.

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

The chairman of SinnerSchrader AG’s Supervisory Board is general manager of Customer F. The Company recognised DM 2,662,736, DM 1,123,520, and DM 1,353,677 in revenue from this customer in 1999/2000, 1999, and 1998, respectively. As of 31 August 2000 outstanding receivables from Customer F amounted to DM 364,875.

up by SinnerSchrader and a third party investor. As a consequence of the capital increase SinnerSchrader AG’s share in the company dropped below 20 %. The capital increase has not yet been registered with the commercial register. The investments are accounted for under the cost method. SinnerSchrader assesses the fair market value of its cost-based investments and recognises any identified impairment.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, generally three to ten years. Depreciation expense is included in cost of revenues and operating expenses.

INVESTMENTS

31.08.2000 in DM

Cost Basis

Unrealised Gains

Unrealised Losses

–

Recorded Basis

Money market funds

59,772,877

378,311

Total short-term investments

59,772,877

378,311

123,669

–

123,669

19,558

–

19,558

143,228

–

143,228

Convertible bond Equity interest Total investments

31.08.2000 in DM

60,151,188 60,151,188

Cost Basis

Unrealised Gains

Unrealised Losses

Recorded Basis

Convertible bond

123,669

–

123,669

Total investments

123,669

–

123,669

SinnerSchrader periodically evaluates the recoverability of the carrying amount of its long-lived assets in accordance with SFAS 121, “Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be disposed of ” . Whenever events or changes in circumstances indicate that the carrying amounts of those assets may not be recoverable, the Company will compare undiscounted net cash flows estimated to be generated by those assets to the carrying amount of those assets. When these undiscounted cash flows are less than the carrying amounts of the assets, the Company will record impairment losses to write the asset down to fair value, measured by the discounted estimated net future cash flows expected to be generated from the assets. During the periods ended 31 August 2000, 31 August 1999 and 31 December 1998, the Management believes that no such impairments exist.

SinnerSchrader’s investments consist of equity interests and convertible securities in two of its clients. Those interests do not reach more than 20 % and SinnerSchrader does not have the ability to exercise significant influence over the management of the respective companies. The equity interest in one client amounted to 20 % on 31 August 2000. SinnerSchrader acquired this interest in February 2000 with the obligation under certain conditions to sign a capital increase as part of which third party investors would contribute to equity and SinnerSchrader AG’s share in the company would dilute below 20 %. On 15 September 2000, a capital increase was signed and paid

S TAT E M E N T S O F C A S H F L O W S

SinnerSchrader paid DM 1,268, DM 21, and DM 115 for interest in the fiscal periods ended 1999/2000, 1999 and 1998, respectively. The Company paid DM 2,096,508, DM 30,180, and DM 75,194 for taxes in 1999/2000, 1999, and 1998, respectively. For the purpose of the consolidated statements of cash flows, SinnerSchrader considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. Cash equivalents consist of amounts on deposit at commercial banks.

SinnerSchrader considers all investments with maturities of less than one year as of 31 August 2000 to be short-term. Short-term investments as of 31 August 2000 are comprised entirely of marketable securities. In accordance with Statement of Financial Accounting Standards No. 115, “Accounting for Certain Investments in Debt and Equity Securities” , SinnerSchrader has categorised these marketable securities as “available-for-sale” . Hence, unrealised gains are included as a separate component of shareholders’ equity, net of tax.

I M PA I R M E N T O F L O N G - L I V E D A S S E T S

REVENUE RECOGNITION

P r o j e c t s e r v i c e s . Services provided by SinnerSchrader range from consulting services for eCommerce strategies and concepts for transactional web solutions, the design and production of web-based user front-ends, to the implementation of software for middleware and back-end systems, as well as to maintenance and content management services for installed solutions. Project and service agreements are either on the basis of time and material or on a fixed-fee basis. Revenues pursuant to a fixed-fee contract are generally recognised as services rendered on the percentage-of-completion method of accounting according to the provisions of Statement of Position (SOP) 81-1 of the American Institute of Certified Public Accountants (AICPA), “Accounting for Performance of Construction Type and Certain Production Type Contracts” . Percentage of completion is determined based on the total efforts expended to date measured in man hours as a percentage of the total efforts expected to be incurred under the contract. Provisions for estimated losses on uncompleted contracts are made on a contract by contract basis and are recognised in the period in which such losses become probable. To date, no such losses have occurred. Revenues pursuant to time and materials contracts are generally recognised as services performed. Revenues include reimbursable expenses charged to and collected from clients.

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

M e d i a s e r v i c e s . SinnerSchrader also provides online-marketing services, i.e. the planning, design, execution and controlling of online-marketing campaigns, for Internet websites mainly to project services customers. For these services, customers are billed for the cost of the related advertising space, for the campaign planning and controlling services rendered by SinnerSchrader either on the basis of a monthly fixed rate or as a percentage of the total value of advertising space managed, and for the design and production services of related online-marketing instruments on an hourly basis. Revenues for the advertising space are generally recognised after the appearance of the advertising. The additional services are generally recognised as performed on a monthly basis. While gross revenues include the entire amount invoiced, the cost of advertising space are excluded from net revenues consistent with industry practice. O t h e r s e r v i c e s . SinnerSchrader also provides operational services, e.g. hosting services and application management and monitoring services. Fees for these services are generally billed and recognised on a monthly basis. In addition, SinnerSchrader provides customers with any required hardware and software on a by request basis. Revenue for third party hardware and software is realised upon delivery.

Accumulated other components of comprehensive income (loss) were as follows:

in DM

Unrealised gains on marketable securities available-for-sale Foreign currency translation adjustment Total

ADVERTISING EXPENSE

SinnerSchrader expenses the cost of advertising and promoting its services and the image of SinnerSchrader in general as incurred. These expenses are included in sales, general and administrative expenses in the consolidated statement of operations. They totalled DM 492,204, DM 10,149, and DM 9,568 in the financial periods 1999/2000, 1999, and 1998, respectively.

31.12.1998

177,056

–

150

–

177,206

–

Unrealised gains on marketable securities available-for-sale Foreign currency translation adjustment Total

Total before tax

Income tax

Total after tax

378,311

- 201,255

177,056

321

- 171

150

378,632

- 201,426

177,206

S T O C K - B A S E D C O M P E N S AT I O N

In October 1995, the Financial Accounting Standard Board (“FASB” ) issued Statement of Financial Accounting Standards (“SFAS” ) No. 123, “Accounting for Stock-Based Compensation”. This standard permits the use of either a fair value based method of accounting or the method defined in Accounting Principles Board (“APB” ) Opinion 25, “Accounting for Stock Issued to Employees” to account for stock-based compensation arrangements. SinnerSchrader has elected to account for its employee stock compensation arrangements in accordance with provisions of APB 25, and complies with the provisions of SFAS No. 123 to disclose the pro forma net income that would have resulted from the application of a fair value based method under section V.b of these notes. Under APB No. 25, compensation expense is based on the difference, if any, on the date of grant between the fair market value of SinnerSchrader’s capital stock on the date of grant and the exercise price.

31.08.1999

A summary of the components of other comprehensive income for the year ended 31 August 2000 is shown in the following table:

in DM K.

31.08.2000

COMPREHENSIVE INCOME

In June 1997, the FASB issued SFAS No. 130, “Reporting Comprehensive Income”, which SinnerSchrader adopted beginning on 1 January 1998. SFAS No. 130 establishes standards for reporting and display of comprehensive income and its components in a full set of general purpose financial statements. The objective of SFAS No. 130 is to report a measure of all changes in equity of an enterprise that results from transactions and other economic events of the period other than transactions with shareholders (“comprehensive income” ). Comprehensive income is the total of net income and all other non-owner changes in equity.

NET EARNINGS PER SHARE

SinnerSchrader computes earnings per share in accordance with SFAS No. 128, “Earnings per Share” . Prior to August 1999, SinnerSchrader was composed of two limited liability companies, SinnerSchrader IM and SinnerSchrader IS, and there were no shares of common stock outstanding. Therefore, earnings per share for the periods prior to fiscal year 1999/2000 are provided on a proforma basis as if the relative ownership interests in the limited liability companies were shares of SinnerSchrader Aktiengesellschaft, the current holding company of the limited liability companies. Basic earnings per share are computed using the weighted-average number of vested shares of common stock outstanding. Diluted earnings per share are computed using the weighted average number of vested shares of common stock outstanding and, when dilutive, unvested common stock outstanding from potential common shares from options and warrants to purchase common stock using the treasury stock method. SinnerSchrader has granted options to purchase shares of common stock to its employees under the 1999 Stock Option Plan. These options are dilutive and thus included in the calculation of the diluted weighted average number of shares of common stock outstanding.

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

in DM or shares

01.09.1999 31.08.2000

01.01.1999 31.08.1999

01.01.1998 31.12.1998

Net Income

3,849,197

1,339,657

92,910

Basic weighted average shares of common stock outstanding

9,563,942

6,025,000

6,000,000

0.40

0.22

0.02

9,563,942

6,025,000

6,000,000

44,336

–

9,608,278

6,025,000

6,000,000

0.40

0.22

0.02

Basic earnings per share Basic weighted average shares of common stock outstanding Add: Dilution because of stock option grants Diluted average shares of common stock outstanding Diluted earnings per share

criteria are met. If a derivative instrument qualifies for hedge accounting, the gains or losses from the derivative may offset results from the hedged item in the statement of operations or other comprehensive income, depending on the type of hedge. To adopt hedge accounting, a company must formally document, designate and assess the effectiveness of transactions that receive hedge accounting. In June 2000, the Financial Accounting Standards Board issued SFAS No. 138, “Accounting for Certain Derivative Instruments and Certain Hedging Activities” . This Statement addresses a limited number of issues causing implementation difficulties for numerous entities that apply SFAS No. 133 and this Statement amends the accounting and reporting standards of SFAS 133 for certain derivative instruments and certain hedging activities. SFAS No. 137 delayed the effective date of SFAS No.133 to fiscal years beginning after 15 June 2000. A Company may implement the statements as of the beginning of any fiscal quarter after issuance; however, SFAS No. 133 cannot be applied retroactively. The adoption of SFAS No. 133, SFAS No. 137, and SFAS No. 138 will not have a material impact on the financial position or the results of operations of the Group.

SEGMENT REPORTING

In 1998 SinnerSchrader adopted the provisions of SFAS No. 131, “Disclosure about Segments of an Enterprise and Related information” . SFAS No. 131 requires a new basis of determining reportable business segments (i.e. the management approach). This approach requires that business segment information used by management to assess performance and manage company resources be the source for information disclosure. SinnerSchrader engages in business activities in one operating segment, which provides integrated eCommerce strategy, implementation and marketing services. Revenue by geographic location are attributed to the country from which the sale is made. In 1998, 1999 and 1999/2000 substantially all of SinnerSchraders’s revenues are attributed to Germany. In 1999/2000 SinnerSchrader also generated revenue in the United Kingdom.

R E C L A S S I F I C AT I O N S

Certain prior year amounts have been reclassified to confirm to the current year presentation.

R ECE NT ACCOU NTI NG PRONOU NCE M E NTS

In June 1998, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards (SFAS) No. 133, “Accounting for derivative instruments and hedging activities” . SFAS No. 133 establishes accounting and reporting standards requiring that every derivative instrument (including certain derivative instruments embedded in other contracts) be recorded on the balance sheet as either an asset or liability measured at its fair value. The statement requires that changes in the derivative’s fair value be recognised currently in earnings unless specific accounting

In December 1999, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin No. 101, “Revenue Recognition in Financial Statements” (SAB 101). SAB 101 outlines the SEC’s views on applying generally accepted accounting principles to revenue recognition in financial statements. Specifically, the bulletin provides both general and specific guidance as to the periods in which companies should recognise revenues. In addition, SAB 101 also highlights factors to be considered when determining whether to recognise revenues on a gross or net basis. SAB 101, as amended by SAB 101/A and SAB 101/B, is effective beginning no later than in the fourth fiscal quarter of the fiscal year beginning after 15 December 1999; as SinnerSchrader’s fiscal year begins on 1 September 2000 this would be the quarter ending 31 August 2001. The Group believes that its policies in regards to the recognition of revenues are in compliance with the guidance of SAB 101 and does not expect that the adoption of this standard will have any material effects on its results of operations, cash flows or financial position. In March 2000, the FASB issued Interpretation No. 44 (“FIN 44 ” ), “Accounting for Certain Transactions Involving Stock Compensation – an Interpretation of APB 25 ”. This interpretation clarifies the definition of employee for purposes of applying Opinion 25, the criteria for determining whether a plan qualifies as a non-compensatory plan, the accounting consequences of various modifications to the terms of a previously fixed stock option or award, and the accounting for an exchange of stock compensation awards in a business combination. This interpretation is effective 1 July 2000, but certain conclusions in the interpretation cover specific events that occur after either 15 December 1998, or 12 January 2000. SinnerSchrader has adopted FIN 44 in its financial statements as of 31 August 2000. It did not have any material impact on the financial condition or results of SinnerSchrader. In May 2000, the Emerging Issues Task Force (EITF) reached consensus on EITF00-8, “Accounting by a Grantee for an Equity Instrument to be Received in Conjunction with Providing Goods or Services” . The EITF reached a consensus that a grantee should measure the fair value of the equity instruments received using the stock price and other measurement assumptions as of the earlier of

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

the date a performance commitment is reached or the date on which the grantee’s performance necessary to earn the equity instruments is complete. For transactions in which any of the terms of the equity instruments are subject to adjustment after the measurement date, changes in fair value resulting from the achievement of grantee performance conditions should be recorded as additional revenue from the transaction using “modification accounting” , as discussed in SFAS No. 123. This Issue applies to all grants and modifications of existing grants that occur after 16 March 2000. SinnerSchrader has received equity instruments in conjunction with providing services in one instance in the past (see Note II.e.), and may do so in the future. SinnerSchrader does not expect that the application of the guidance in this issue has a material impact on its financial conditions or results of operations.

ACCR U E D LIAB I LITI E S

Other accrued liabilities consist of the following: in DM

Accrued compensation

31.08.1999

31.12.1998

574,345

250,000

99,154

Accruals for invoices outstanding for online media placements

605,531

–

Other accruals

924,301

189,508

26,540

2,104,177

439,508

125,694

Total

III. Balance Sheet Components

31.08.2000

COMMITMENTS:

Facilities and certain furniture and equipment are leased under operating leases. As of 31 August 2000 future annual minimum lease payments are as follows:

PROPERTY AND EQUIPMENT

Property and equipment is comprised of the following: in DM

Minimum lease payments

in DM

31.08.2000

31.08.1999

31.12.1998

01.09.00 – 31.08.01

1,245,598

Computer hardware and software

1,157,395

414,580

247,163

01.09.01 – 31.08.02

2,777,041

718,987

490,375

270,214

01.09.02 – 31.08.03

2,732,020

1,876,382

904,955

517,377

01.09.03 – 31.08.04

2,729,692

Less: Accumulated depreciation

- 754,062

- 383,778

- 216,012

01.09.04 – 31.08.05

2,424,361

Total, at book value

1,122,320

521,177

301,365

thereafter

2,493,080

Furnitures and fixtures Total, at cost

Total

Total rent expense was DM 650,743, DM 231,659, and DM 196,703 in 1999/2000, 1999 and 1998, respectively.

O T H E R C U R R E N T A S S E T S A N D P R E PA I D E X P E N S E S

The major components of other current assets and prepaid expenses are shown in the following table: in DM

01.09.1999 31.08.2000

01.01.1999 31.08.1999

01.01.1998 31.12.1998

Tax receivables

3,412,188

–

Deferred tax assets Other current assets Prepaid expenses Total

14,401,792

–

100,072

–

130,206

9,926

6,500

96,614

86,114

21,627

3,639,008

196,112

28,127

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

IV. Components of the statements of operations A.

V. Shareholders’ equity

C O S T S A N D O P E R AT I N G E X P E N S E S B Y E X P E N D I T U R E

The split of cost of revenues and operating expenses by expenditure is shown in the following table: 01.01.1998 31.12.1998

in DM

01.09.1999 31.08.2000

01.01.1999 31.08.1999

Personnel cost

8,696,115

1,922,506

1,618,837

1,290,267

41,913

45,399

Sub-contracted services

448,418

95,093

137,397

Depreciation

425,766

191,685

161,877

4,887,657

952,069

668,473

15,748,223

3,203,266

2,631,983

INITIAL PUBLIC OFFERING

In November 1999, SinnerSchrader AG issued 2,475,000 new shares of common stock as part of an initial public offering on the Neuer Markt (225,000 shares thereof as greenshoe) at a price of  12 per share. The offering raised aggregate proceeds – net of expenses for the flotation of DM 3.3 million – of DM 54.8 million. The cost resulting from the initial public offering were charged against the capital reserve net of tax of DM 1.76 million.

Cost of materials and services in cost of revenues

Materials

Other operating expenses Total

FINANCIAL INCOME

The financial income, net, consists of the following components:

in DM

Interest income Realised gains on marketable securities Interest expense Fee expense in relation to gains on marketable securities Total

01.09.1999 31.08.2000

01.01.1999 31.08.1999

01.01.1998 31.12.1998

569,577

12,066

7,841

1,035,671

–

- 1,268

- 21

- 115

- 28,853

–

1,575,127

12,045

7,726

E M P L OY E E S T O C K O P T I O N P L A N

In October 1999, the shareholders of SinnerSchrader AG approved the SinnerSchrader 1999 Stock Option Plan (the “1999 Plan”) which provides for the granting of stock options to the members of the Management Board of SinnerSchrader AG, the management of affiliated companies, all employees of SinnerSchrader AG, as well as all employees of affiliated companies. The total number of options that can be assigned by the Management Board and the Supervisory Board of SinnerSchrader AG is 375,000 of which 40,000, 10,000, 55,000, and 270,000 are dedicated to the before mentioned groups, respectively. Options granted under the 1999 Plan have an exercise price of 120 % of the average Frankfurt closing price during the ten trading days prior to the grant date. Options granted on 1 November 1999, the day of the initial public offering, had an exercise price of  14,40. The options of the 1999 Plan vest in equal instalments of one third over two, three and four years. They have to be exercised within six years after the date of grant. As of 31 August 2000 a total of 165,300 stock options from the 1999 Plan were outstanding which were granted with an average exercise price of  32,96. No options were granted to the Management Board and the management of affiliated companies. SinnerSchrader applies APB No. 25 in accounting for its stock option plan. Had compensation expense for options granted in 1999/2000 been determined based on the fair value at the grant dates as prescribed by SFAS No. 123, SinnerSchrader’s net income and net income per share would have been affected as indicated in the following table:

in DM

01.09.1999 31.08.2000

01.01.1999 31.08.1999

01.01.1998 31.12.1998

Reported net income

3,849,197

1,339,657

92,910

Pro forma compensation expense due to options granted Pro forma net income

- 870,964

–

2,978,233

1,339,657

Reported net income per share, basic

0.40

0.22

0.02

Pro forma net income per share, basic

0.31

0.22

0.02

Reported net income per share, diluted

0.40

0.22

0.02

Pro forma net income per share, diluted

0.31

0.22

0.02

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

The fair value of each option was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions for the options granted in 1999/2000: Expected life of the option

3.5 years

Risk-free interest rate

3.9 % – 5.2 %

Expected dividend yield

Expected volatility

90 %

A U T H O R I S E D C A P I TA L

The Management Board is authorised to increase the Company’s share capital for a period ending 30 September 2004 with the approval of the Supervisory Board in one or more steps up to a maximum of 4,650,000 shares. To date no shares have been issued based on that authorisation. Additionally, the Management Board is authorised to increase the Company’s share capital for a period ending 24 September 2004 with the approval of the Supervisory Board in one or more steps up to a maximum of 225,000 shares. In November 1999, the Company issued 225,000 shares based on this authorisation in connection with the greenshoe granted to banks as part of the initial public offering.

The following table summarises the changes in the total options outstanding in the fiscal year 1999/2000: Number of options granted

Outstanding at beginning of year

Granted

Weighted average exercise price € (DM)

–

189,100

33.64 (65.79)

Exercised

–

Cancelled

- 23,800

38.37 (75.05)

Outstanding at end of year

165,300

32.96 (64.46)

Range of exercise prices

EQU ITY ADJ USTM E NT

As discussed under I, the consolidated financial statements for periods prior to 31 August 1999 are presented as if all entities of SinnerSchrader were consolidated from inception. As a result, the contribution of SinnerSchrader IM and SinnerSchrader IS was recorded at historical book value of these companies in the consolidated balance sheet of SinnerSchrader. In order to present SinnerSchrader AG’s common stock par value of  7,500,000 it was necessary to correct the difference resulting from the consolidation of the equity accounts of DM 11,739,980 as an “Equity adjustment” .

VI. Income tax

The subsequent table presents a summary of the stock options outstanding as of 31 August 2000: Options outstanding

Options exercisable

SinnerSchrader accounts for income taxes pursuant to SFAS No. 109, “Accounting for Income Taxes.” The provision for income taxes consists of the following:

Number

Weighted average remaining contractual life in years

Weighted average exercise price €

Number

Weighted average exercise price €

14,40 – 30,00

78,200

5.17

14.40

–

in DM

01.09.1999 31.08.2000

01.01.1999 31.08.1999

01.01.1998 31.12.1998

30,00 – 50,00

46,200

5.77

37.79

–

Current

3,828,931

1,700,724

115,031

50,00 – 70,00

30,600

5.53

58.60

–

Deferred

531,011

- 176,553

99,438

70,00 – 90,00

10,300

5.59

76.00

–

Total

4,359,942

1,524,171

214,469

165,300

5.43

32.96

–

€

Total

C O N D I T I O N A L C A P I TA L

As of 31 August 2000 the Company had conditional capital which is equivalent to shares reserved for future issuance of  375,000 for the SinnerSchrader 1999 Stock Option Plan described under b.

The provision for income taxes differs from the expected tax provision amount computed by applying the statutory income tax rate to income before taxes. For the fiscal periods ended 31 August 2000 the statutory income tax rate for income retained was at 53.2 % (1999: 53.2 %, 1998: 57.5 %) consisting of municipal trade tax (“Gewerbesteuer” ) at 19.0 % (1999: 19.0 %, 1998: 19.0 %), corporate tax (“Körperschaftsteuer” ) at 40 % (1999: 40 %, 1998: 45 %) and a corporate tax surcharge (“Solidaritätszuschlag” ) of 5.5 % (1999: 5.5 %, 1998: 5.5 %). On 14 July 2000, legislation was passed in Germany according to which the tax rate for corporate tax (“Körperschaftsteuer” ) will be reduced from 40 % to 25 % effective for all fiscal years starting after 31 December 2000. With the new

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

VII. Subsequent events

corporate tax rate the total statutory income tax rate for income retained will amount to 40.4 %. For deferred items that are reasonably expected to materialise in a fiscal year for which the new statutory income tax will be applied, this tax rate has been used to compute deferred taxes. The following table presents the reconciliation of tax provisions shown in the statements of operations to the income tax provisions expected under the statutory income tax rate:

On 15 September 2000 SinnerSchrader AG paid up approximately DM 300.000 for a capital increase by one of the companies in which SinnerSchrader holds a minority interest (ref. to note II.G). As part of the capital increase, a third party investor contributed additional equity capital in cash.

in DM

01.09.1999 31.08.2000

01.01.1999 31.08.1999

01.01.1998 31.12.1998

Tax provision at statutory rate

4,367,129

1,524,171

176,650

Tax benefit for distributed income

–

- 35,030

8,477

–

82,182

Valuation allowance loss carry forwards of foreign subsidiary

71,241

–

Corporate tax deduction due to assumed foreign withholding tax

- 129,551

–

Non deductible expenses

Limited ability to set off income and losses within the group regarding the corporate tax surcharge

83,747

–

- 45,001

–

- 9,333

3,900

–

4,359,942

1,524,171

214,469

01.09.1999 31.08.2000

01.01.1999 31.08.1999

01.01.1998 31.12.1998

26,783

100,072

–

- 26,783

–

100,072

–

Valuation of unfinished/unbilled services 1)

329,885

–

25,061

Valuation of unrealised gains on marketable securities available for sale

201,255

–

96,399

25,633

77,053

Change in tax rate for deferred taxes Other Provision for income tax

The deferred tax position consists of the following items:

in DM

Deferred tax assets:

Tax on loss carry forwards of foreign subsidiary Valuation allowance on loss carry forwards of foreign subsidiary Total deferred tax assets Deferred tax liabilities:

Valuation of fixed assets Valuation of current assets Total deferred tax liabilities

1) according

to the “percentage of completion” method

30,289

–

657,828

25,633

102,114

On 18 September 2000 SinnerSchrader AG entered into an agreement to purchase 100 % of the shares of Netmatic Internet/Intranet Solutions GmbH, Hamburg. Netmatic Internet/Intranet Solutions provides software design and development services for transactional web applications. According to the German law for stock corporations (“Aktiengesetz” ) the consummation of the transaction is dependent upon shareholders’ approval. The Company will present the transaction to its shareholders’ at the ordinary shareholders’ meeting in December 2000. The final purchase price for the acquisition depends on Netmatic’s revenue and earnings performance in the year 2000. A first instalment consists of DM 3 million in cash and 437.246 shares of common stock of SinnerSchrader AG. The first instalment will become due upon approval of the transaction by the shareholders’ meeting.

Hamburg, October 2000 The Management Board

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

Summary of significant differences between US-GAAP and German Law with regard to accounting, valuation and consolidation principles. 1.

GENERAL

The consolidated financial statements of SinnerSchrader Aktiengesellschaft, (hereinafter referred to as the “Company” or “SinnerSchrader”) as of 31 August 2000, 31 December 1999 and of 31 December 1998 were prepared in accordance with US generally accepted accounting principles (US-GAAP).

fiscal year. Regarding the loss carried forward by the consolidated SinnerSchrader UK Ltd. a valuation allowance was recorded for the entire amount due uncertainties concerning future profitability. 4.

E M P L OY E E S T O C K O P T I O N S

According to US-GAAP, stock-based compensation issued to employees may be accounted for in two ways. Under one method, the “fair value” of stock-based compensation is determined and recorded as an expense over the vesting period of the option. Alternatively, only the difference between the exercise price of the option and the fair market value of the underlying security (“intrinsic value”) on the date of grant is recognised as an expense over the vesting period. Under the latter method, the impact on net income of accounting for the stock-based compensation using the first method must be disclosed in a pro-forma calculation in the financial statements. SinnerSchrader has elected the intrinsic value method as its accounting policy.

The provisions of the German Commercial Code (HGB) and German Stock Corporation Law (AktG) differ from US-GAAP in certain significant respects. The main differences that may be relevant to an evaluation of the net worth, financial position, and the results of the Company are described below:

As noted before, the difference between the exercise price of the option and the market value of the underlying security on the date of grant are to be treated, according to US-GAAP, as personnel expenses recorded ratably over the vesting period of the option and correspondingly recorded under equity. Because of the negative intrinsic value at the time of the options’ granting, according to US-GAAP there was no personnel cost from the granting of stock options.

Pursuant to HGB, all items in the balance sheet and income statement must be set out in the form and order laid down in §§266, 275 HGB. US-GAAP requires a different presentation, in which the short-term items in the balance sheet are presented first.

In line with currently accepted accounting rules, no expense would occur in the income statement pursuant to HGB. Only the capital increase necessary upon exercising of options would have to be recorded under equity.

PROPERTY AND EQUIPMENT

Purchased software for internal use is not shown as an intangible asset, as it is in financial statements prepared according to HGB, but as property and equipment, such as fixtures, furniture and office equipment. According to US-GAAP, costs to develop software to be sold, leased or otherwise marketed can be capitalised and amortised over their estimated economic life. According to HGB, the cost of internally developed software cannot be capitalised. In all fiscal years up to 31 August 2000, the Company has charged all software development cost against income also under US-GAAP. According to HGB accelerated depreciation permitted according to German corporate tax regulations (§ 7g EstG) are shown as special reserves and are dissolved over the average useful life of the assets. According to US-GAAP these tax driven depreciation were not considered. According to HGB, the depreciation were made applying a linear depreciation schedule and the half-year method (“Halbjahresmethode”). Under US-GAAP linear depreciations had to be considered as from the day of purchase.

D E F E R R E D TA X E S O N L O S S C A R R Y- F O R W A R D S

According to HGB, deferred tax refund claims arising from loss carry-forwards may not be shown on the balance sheet as expected future tax savings are deemed to be not yet realised. According to US-GAAP, these types of future tax reduction claims are to be capitalised. Their value depends on whether it is more likely than not that the loss carry-forward can be used before they expire. In 1999/2000, the Company used its loss carry-forwards from the previous

FINANCIAL ASSETS

Financial assets include a convertible bond that a client of SinnerSchrader afforded as part of the return for services rendered. The investment was recognised at the market value on the grant day. For that the option component of the convertible bond was valued using the BlackScholes-Model. Under HGB, the value of the assets offered in barter transactions would determine principally the acquisition cost.

EQUITY

According to HGB, the Company would have had to prepare consolidated financial statements for the first time following the acquisition of Sinner+Schrader Interactive Marketing GmbH and Sinner+Schrader Interactive Software GmbH on 27 August 1999 and perform the capital consolidation as of this date. The difference between the book value of the participation and the equity capital of its subsidiary would have to be distributed according to the actual value of the assets and liabilities included in consolidation. The remainder would have to be shown as goodwill and either amortised over its expected useful life or off-set against the capital reserves on the face of the balance sheet. The subscribed capital in the consolidated balance sheet would be the subscribed capital of the company. According to US-GAAP the contribution of shares of Sinner+Schrader Interactive Marketing GmbH and of Sinner+Schrader Interactive Software GmbH to SinnerSchrader is recognised at the book value of Shareholders’ equity of these companies. As a consequence, no goodwill was created by this

AU D I TO R S ’ O P I N I O N G R O U P

C O N S O LI DAT E D F I N A N C I A L S TAT E M E N T S

Auditors’ Opinion transaction. For the presentation of the statement of SinnerSchrader’s share capital of 7.500.000  at the date of the transaction an equity adjustment was made as part of total equity. Effectively, under US-GAAP, the capital consolidation of the Company in line with APB 16 “Business Combination” is recorded for as a “transaction under common control”, which eliminates the contribution of the shares in Sinner+Schrader Interactive Marketing GmbH and Sinner+Schrader Interactive Software GmbH to SinnerSchrader AG and means that only the amounts raised originally are shown as equity. In accordance with this no goodwill results from these transactions under US-GAAP. Therefore, according to US-GAAP, the time of first consolidation does not apply, so that the disclosures made before the formation of SinnerSchrader AG reflect the respective group structure.

REVENUE RECOGNITION

Under US-GAAP, revenues for services are recognised in compliance with “American Institute of Certified Public Accountants Statement of Postition” (SOP) 81-1, “Accounting for Performance of construction type and certain production type contracts” . US-GAAP requires accounting for work in process on service transactions to be performed according to the “percentage of completion method” , whereby the progress in a project leads to revenue recognition on a pro-rata basis. The main condition for the application of the “percentage of completion method” is the reconcilable and controllable measurement of progress made in a project. HGB requires the “completed contract method” . According to that method, service revenues would only be taken into account upon completion of work.

V A L U AT I O N O F S E C U R I T I E S ( A V A I L A B L E F O R S A L E )

According to US-GAAP, the securities under current assets are shown at market value on the balance sheet date, in case they are held available for sale at any time. Profits and losses that have not yet been realised through sales are shown in shareholders’ equity and are part of comprehensive income. According to HGB, SinnerSchrader AG values the securities under current assets at acquisition costs or at market value, whichever is lower.

We have audited the consolidated financial statements, consisting of balance sheet, income statement, statement of shareholders’ equity, cash flow statement and notes to the consolidated financial statements of SinnerSchrader Aktiengesellschaft for the financial year from 1 September 1999 to 31 August 2000. The preparation and the content of the consolidated financial statements is the responsibility of the Company’s management. Our responsibility is to express an opinion on the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP), based on our audit.

We conducted our audit of the consolidated financial statements pursuant to German auditing standards and in compliance with the generally accepted auditing principles set forth by the Institut der Wirtschaftsprüfer (IDW). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The scope of the audit was planned taking into account our understanding of business operations, the Company’s economic and legal environment, and any anticipated potential errors. An audit includes examining, mainly on a basis of spot checks, evidence supporting the amounts and disclosures in the consolidated financial statements. The audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the consolidated financial statements present in compliance with U.S.-GAAP a true and fair view of the financial position, the results, and cash flows of the Company. Our audit, which also includes the management report for the fiscal year from 1 September 1999 to 31 August 2000, prepared by the legal representatives of the Company, did not give any cause for qualification. In our opinion the management report accurately presents, in all material respects, the situation of the Company and the risks arising from future developments. Furthermore, we confirm that the consolidated financial statements and the management report meet the requirements for an exemption to present consolidated financial statements and a management report according to German law.

Hamburg, 24 October 2000 ARTH U R AN D E R S E N

COSTS OF INITIAL PUBLIC OFFERING

According to US-GAAP, costs connected with the initial public offering on the stock exchange are to be treated as a reduction of the proceeds from the issuing of stocks net of the effect from the tax deductability of these costs. According to HGB, these costs of DM 3.3 million represent other operating expenses.

Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft mbH

Nendza

Schneider

Certified Auditor

F I N A N C I A L S TAT E M E N T S

of SinnerSchrader Aktiengesellschaft 1999/2000

BALANCE SHEETS

STATEMENTS OF OPERATIONS

NOTES TO THE FINANCIAL STATEMENTS AT 31 AUGUST 2000

AUDITORS’ OPINION AG

SUPERVISORY B OARD REPORT

F I N A N C I A L S TAT E M E N T S AG

Balance sheets

Statement of operations

as of 31 August 2000 and 31 August 1999

for the fiscal year ended 31 August 2000 and the period from 19 July to 31 August 1999

Assets

31.08.2000 in DM

31.08.1999 in DM

Revenues

Fixed Assets:

01.09.1999 31.08.2000 in DM

19.07.1999 31.08.1999 in DM

892,743

1,062,437

Property, plant and equipment:

Other equipment, plant and office equipment

3,515

16,032,095 19,558 16,051,653 16,055,168

16,000,000 0 16,000,000 16,000,000

1,480,793 2,705,943 4,186,736

0 7,003 7,003

Deficit not covered by Equity

59,772,877 74,898 64,034,511 78,336 0

0 3,950,789 3,957,792 0 145,722

Total assets

80,168,015

20,103,514

31.08.2000 in DM

31.08.1999 in DM

19,509,404 58,578,748 354,494 118,164 0 78,560,810 0

48,895 0 0 - 194,617 145,722 0 19,902,209

304,302 660,591 964,893

0 150,000 150,000

2,135 560,112 1,669

0 51,305 0

Other operating income

Financial assets:

Shares in affiliated companies Participations Total financial assets

Wages and salaries

Social security Personnel expenses Total personnel cost

- 1,173,639 - 29,531 - 1,203,170

0 0 0

Current assets:

Depreciation of intangible assets, property and equipment

Receivables and other assets

Receivables from affialiated companies Other assets Total receivables and other assets Securities:

Other securities Cash-in-hand and bank balances Total current assets Prepaid expenses

Liabilities and Shareholdersâ&#x20AC;&#x2122; Equity

Total equity Paid-in capital for capital increase not yet registered

- 6,264,337

- 194,617

Income from participations thereof from affiliated companies DM 5,428,571 (previous year DM 0)

5,428,571

Other interest and similar income

1,169,691

-415

1,078,041

- 194,617

- 410,192

- 574

667,275

- 194,617

Accumulated deficit carried forward Addition to statutory reserves

- 194,617 - 354,494

0 0

Retained earnings/accumulated deficit

118,164

- 194,617

Other operating expenses

Other interest and similar expenses Results from ordinary operations

Taxes on income Other taxes

Equity:

Subscribed capital (Conditional capital: DM 733,436; previous year: DM 0) Capital surplus Statutory reserves Retained earnings/accumulated deficit Deficit not covered by equity

- 7,479

Net income/loss for the year

Accruals:

Accrued tax liabilities Other accrued liabilities Total accrued liabilities Liabilities:

Liabilities to banks Trade payables Payables to affiliated companies Other liabilities

thereof taxes: DM 36,224 (previous year DM 0) thereof relating to social security and similar obligations: DM 8,082 (previous year DM 0)

Total liabilities Total Liabilities and Shareholdersâ&#x20AC;&#x2122; Equity

The accompanying notes are an integral part of these financial statements.

78,396

642,312

51,305

80,168,015

20,103,514

The accompanying notes are an integral part of these financial statements.

F I N A N C I A L S TAT E M E N T S AG

Notes to the Financial Statements at 31 August 2000

III. Notes and explanations to individual items of the balance sheet A.

ASSETS

Changes to the fixed assets are shown in the table below:

I. General

Acquisition and manufacturing cost

Other equipment, fixtures and fittings The company is considered to be a large corporation as defined by Â§ 267 of the German Commercial Code. The companyâ&#x20AC;&#x2122;s annual financial statements were drawn up in accordance with the accounting and valuations regulations stipulated in the German Commercial Code (HGB) and the German Stock Corporation Law (AktG).

II. Accounting and valuation methods

Additions

Disposals

31.08.2000

10,994

16,000,000

32,095

16,032,095

19,558

16,000,000

62,647

16,062,647

01.09.1999

Additions

Disposals

31.08.2000

7,479

Financial assets:

Shares in affiliated companies Participations

Accumulated depreciation

Tangible fixed assets:

Other equipment, fixtures and fittings The results are drawn up in DM.

01.09.1999

Tangible fixed assets:

Financial assets:

Shares in affiliated companies

Tangible fixed assets are recorded at acquisition cost or manufacturing cost, minus linear depreciation as scheduled. Linear depreciation is calculated on the basis of the useful life of the asset. Assets acquired in the first half of the fiscal year are subject to the full rate of depreciation and assets acquired in the second half of the fiscal year are subject to half that rate. Low value items with an acquisition cost of up to DM 800 are depreciated in full in the year of acquisition.

Participations

7,479

Financial assets are recorded at acquisition cost, or at their value on the balance sheet date if that is lower.

Net book value

Accounts receivable and other assets are recorded at face value. Accounts receivable in foreign currencies are recorded at the original exchange rate or at the rate on the balance sheet date if that is lower.

01.09.1999

31.08.2000

3,515

16,000,000

16,032,095

Tangible fixed assets:

Other equipment, fixtures and fittings Financial assets:

Shares in affiliated companies Participations

Other accrued liabilities cover all foreseeable risks. They are set at a level considered necessary in accordance with sound commercial practice.

19,558

16,000,000

16,055,168

Liabilities are recorded at the amount repayable. Liabilities in foreign currencies are recorded at the original exchange rate or at the rate on the balance sheet date if that is higher. B.

A C C O U N T S R E C E I VA B L E A N D O T H E R A S S E T S

Accounts receivable and other assets amounting to DM 4,186,736 are due within one year.

F I N A N C I A L S TAT E M E N T S AG

M A R K E TA B L E S E C U R I T I E S

IV. Notes and explanations to individual items of the profit and loss account

Marketable securities consist of shares in money market funds or funds of a similar nature that are recorded at acquisition cost.

A. D.

A C C R U E D I N C O M E A N D P R E PA I D E X P E N S E S

Revenues amounting to DM 892,743 relate to management services provided by the Company to companies within the SinnerSchrader Group.

Accrued income and prepaid expenses consist principally of exceptional lease payments.

REVENUES

S H A R E C A P I TA L

O T H E R O P E R AT I N G I N C O M E

The company’s share capital stood at  9,975,000 as of 31 August 2000. It is made up of 9,975,000 individual bearer shares with no face value.  225,000 of this results from the Authorised Capital I approved by the Shareholders’ Meeting on 4 October 1999; all of this capital was devoted to the exercise of the additional distribution option (greenshoe) in the context of the company’s stock market launch.

Other operating income results with an amount of DM 788,940 mainly from the sale of marketable securities. In addition, DM 229,807 concern reimbursements of costs from affiliated companies.

The Shareholders’ Meeting on 8 October 1999 gave the Management Board the power to increase the company’s share capital by up to  4,650,000 with approval of the Supervisory Board by 30 September 2004; this increase could take place in a single action or could be split into several actions, and would consist of issuing individual bearer shares with no face value in return for contributions in cash or in kind not confering any subscription rights on the shareholders (Authorised Capital II). The Management Board did not make use of these authorisations in the fiscal year 1999/2000.

The Management Board and Supervisory Board propose to the Annual General Meeting to carry forward the balance sheet profit of DM 118,164.49 to the new fiscal year.

The Shareholders’ Meeting on 26 October 1999 created a conditional capital of  375,000 to confer on employees and members of management of the Company and affiliated companies subscription rights to 375,000 individual shares. By 31 August 2000, employees of the company and affiliated companies had been granted 165,300 option rights at an average exercise price of  32.96. None of these option rights had been exercised as at the balance sheet day.

C A P I TA L S U R P L U S

The following changes affected the capital reserve in the financial year 1999/2000: Capital surplus as at 31.08.1999

Premium from capital increase through contribution in cash

58,578,748

Capital surplus as at 31.08.2000

58,578,748

PROPOSAL FOR DISPOSITION OF EARNINGS

IV. Other information A.

O T H E R F I N A N C I A L O B L I G AT I O N S

Obligations arising from rent and leasing contracts

01.09.2000-31.08.2001

698,181

01.09.2001-31.08.2002

2,314,607

01.09.2002-31.08.2003

2,274,024

01.09.2003-31.08.2004

2,271,696

01.09.2004-31.08.2005

2,271,696

after 01.09.2005

2,493,080

The financial obligations relate principally to rent Payments for the new office building for the Company and its affiliated companies. The Company will start to move into these new premises in December 2000 and the move will be completed in July 2001.

OTH E R ACCR U E D LIAB I LITI E S

A reserve of DM 304,302 was formed to cover trade tax. The other reserves of DM 660,591 were formed principally to cover the auditing cost, holiday entitlement as well as outstanding in-voices.

S TA F F

The company had 4 employees on 31 August 2000. The average number of staff for the fiscal year 1999/2000 was 2. H.

LIABILITIES

All the liabilities amounting to DM 642,312 have maturities of up to one year.

M A N AG E M E N T B OA R D

The following persons were members of the Management Board in the fiscal year 1999/2000: Matthias Schrader, Co-Chief Executive Officer Oliver Sinner, Co-Chief Executive Officer Thomas Dyckhoff, Chief Financial Officer Detlef Wichmann, Chief Technology Officer

Messrs. Dyckhoff and Wichmann were appointed as members of the Management Board by a decision of the Supervisory Board on 27 Ocotober 1999. The appointment was recorded in the Trade Register on 22 February 2000. Total emoluments paid to the Management Board in the financial year amounted to DM 949,922.

F I N A N C I A L S TAT E M E N T S AG

FINANCIAL ASSETS

The company holds the following investments and shares in affiliated companies and participations:

Stake in %

Currency

Authorised share capital

Sinner+Schrader Interactive Marketing GmbH, Hamburg

100.00

Sinner+Schrader Interactive Software GmbH, Hamburg

100.00

Company

Net equity

Last annual profit/loss

50,000

2,931,368 1)

3,740,575 1)

50,000

91,021 1)

17,620 1)

100.00

10,000

- 31,843 2)

- 41,843 2)

20.00



50,000

SinnerSchrader UK Limited, D.

S U P E R V I S O RY B OA R D

The following persons were members of the Supervisory Board in the fiscal year:

London, UK LetMeShip GmbH, Hamburg

Dr. Markus Conrad, Chairman 1)

Stub period from 01.01.2000 to 31.08.2000

Managing partner of Georg Lingenbrink GmbH & Co., Hamburg Member of the Supervisory Board of Tchibo Holding AG, Hamburg Member of the Supervisory Board of Zapf Creation AG, Rödental

Stub period from 23.03.2000 to 31.08.2000

The company was founded in February 2000 and has not yet published results.

Fritz Seikowsky, Deputy chairman, since 29 September 1999

Hamburg, October 2000

Managing Director of Bain & Company Germany, Munich Deputy chairman of the Supervisory Board of The Internet.z AG, Hamburg Member of the Supervisory Board of insure.XL GmbH, Munich Member of the Advisory Board of Servolutions GmbH, Berlin

Reinhard Pöllath, Lawyer, Munich

Member of the Supervisory Board of TA Triumph-Adler AG, Nuremberg Member of the Supervisory Board of Wanzl Metallwarenfabrik GmbH, Leipheim Member of the Supervisory Board of F-LOG AG, Greven Member of the Supervisory Board of Tchibo Holding AG, Hamburg

Dr. Andrea von Drygalski, Lawyer, Munich until 28 September 1999

The remuneration to the Supervisory Board in the fiscal year amounted to DM 35,205.

The Management Board

S U P E R V I S O RY B OA R D R E P O R T

AU D I TO R S ’ O P I N I O N AG

Auditors’ Opinion

Supervisory Board Report

We have audited the financial statements including the accounting and the management report of SinnerSchrader Aktiengesellschaft for the fiscal year from 1 September 1999 to 31 August 2000. The legal representatives of the Company are responsible for the accounting and preparation of the financial statements and management report in compliance with German commercial law and the supplementary regulations in the articles of association. Our responsibility is to express an opinion, based on our audit, on the financial statements, including the accounting, and on the management report.

The Supervisory Board continuously oversaw the progress of business at SinnerSchrader Aktiengesellschaft throughout the fiscal year 1999/2000. It was regularly informed about the position and progress of the company and about major business transactions by the Management Board – both during scheduled meetings and outside these meetings. On this basis, the Supervisory Board fulfilled the responsibilities it carries according to the law and the Articles of Incorporation, and supervised the management activities of the Management Board.

We conducted our audit of the financial statements pursuant to sec. 317 HGB and in compliance with the generally accepted auditing principles set down by the Institut der Wirtschaftsprüfer (IDW). Those standards require that we plan and perform the audit to obtain reasonable assurance that inaccuracies and violations are recognised which significantly affect the presentation of the assets, liabilities, financial position and results of the Company as conveyed by the financial statements, in compliance with generally accepted accounting principles, and by the management report. The scope of the audit was planned taking into account our understanding of business operations, the Company’s economic and legal environment, and any potential errors anticipated. In the course of the audit, the effectiveness of the system of internal controls has been assessed, and the disclosures made in the accounting, financial statements and management report have been verified, mainly on the basis of spot checks. The audit also includes assessing the accounting principles used and significant estimates made by the legal representatives, as well as evaluating the overall presentation of the financial statements and the management report. We believe that our audit provides a reasonable basis for our opinion. Our audit did not give any cause for qualification. In our opinion, the financial statements are in compliance with generally accepted accounting principles and present a true and fair view of the assets, liabilities, financial position and results of the Company. In all material respects, the management report accurately presents the situation of the Company and the risks arising from future developments.

Hamburg, 24 October 2000

During the past financial year the Supervisory Board was convened for six meetings. The Supervisory Board did not form any committees. The Supervisory Board resolved on 1 September 1999 to elect Mr. Dr. Markus Conrad as its Chairman and Mr. Reinhard Pöllath as his deputy. At an extraordinary General Meeting on 29 September 1999 Mr. Fritz Seikowsky was appointed member of the Supervisory Board, replacing Mrs. Dr. Andrea von Drygalski who had resigned from her office on 28 September 1999. In a resolution passed by the Supervisory Board on 30 September 1999, Mr. Seikowsky succeeded Mr. Pöllath in his capacity as Deputy Chairman of the Supervisory Board. On 27 October 1999, the Supervisory Board appointed Mr. Detlef Wichmann and Mr. Thomas Dyckhoff as members of the Management Board of SinnerSchrader AG. At the request of the Supervisory Board, Arthur Andersen Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft mbH (certified auditors and tax consultants), Hamburg, audited the bookkeeping and financial statements of SinnerSchrader Aktiengesellschaft, as well as the consolidated financial statements of the SinnerSchrader Group drawn up in compliance with § 292 a HGB (German Commercial Code) with discharging effect, under application of the US GAAP, including the joint status report of the Group and of SinnerSchrader Aktiengesellschaft. These were awarded an unqualified auditors’ opinion in October 2000. In a meeting on 31 October 2000, the Supervisory Board discussed the financial statements and the consolidated financial statements in detail on the basis of the auditor’s report in the presence of the auditors and the Management Board. The Supervisory Board did not raise any objections and endorsed the results of the auditors. The Management Board’s suggestion of carrying the year’s balance sheet profit of DM 118,164.49 forward to the new accounts was approved by the Supervisory Board. The Supervisory Board approved the financial statements drawn up by the Management Board; they are thereby confirmed.

ARTH U R AN D E R S E N

Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft mbH

The fiscal year 1999/2000 was a very successful year for SinnerSchrader Aktiengesellschaft. Ambitious sales and earnings targets were exceeded, and profitability were unequalled in the industry. The challenge now is to continue on this successful course during the fiscal year 2000/2001. To this end, the Supervisory Board will support the Management Board in every possible respect.

Nendza

Schneider

Certified Auditor

The Supervisory Board expresses its gratitude to the members of the Management Board and all the employees for their commitment, and for all their work during the past fiscal year.

Hamburg, November 2000 Dr. Markus Conrad Chairman of the Supervisory Board

Financial Calendar 2000/2001 A N N UA L G E N E R A L M E E T I N G

12 December 2000 Q UA R T E R LY R E P O R T S E P T E M B E R – N OV E M B E R 2 0 0 0

January 2001 Q UA R T E R LY R E P O R T D E C E M B E R 2 0 0 0 – F E B R UA RY 2 0 0 1

April 2001 Q UA R T E R LY R E P O R T M A R C H – M AY 2 0 0 1

July 2001 A N N UA L R E P O R T 2 0 0 0 / 2 0 0 1

November 2001

Contact HAM B U RG

SinnerSchrader Aktiengesellschaft Planckstraße 13 22765 Hamburg Germany Phone: +49 (0)40 39 88 55- 0 Fax: +49 (0)40 39 88 55- 55 eMail: info@sinnerschrader.com www.sinnerschrader.com SinnerSchrader Aktiengesellschaft I N V E S TO R R E L AT I O N S

– Julia Kretschmann – Planckstraße 13 22765 Hamburg Germany Phone: +49 (0)40 39 88 55-0 Fax: +49 (0)40 39 88 55-55 eMail: ir@sinnerschrader.com www.sinnerschrader.com LO N D O N

SinnerSchrader UK Ltd. The Birdseed Building Mill Street London SE1 2DZ Great Britain Phone: +44 (0)781 804 56 37 eMail: info.uk@sinnerschrader.com www.sinnerschrader.co.uk

Editorial P U B LI S H E R

SinnerSchrader Aktiengesellschaft, Hamburg

CONCE PTION AN D DE S IG N

MUTABOR, Hamburg P H OTO G R A P H Y

Ute Schuckmann, Hamburg PR I NT

Langebartels & Jürgens, Hamburg

I N T E R A C T I V AT E

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